Operation Flood and Cooperatives

Peasants of Kheda district, Gujarat which supplied milk to Bombay felt cheated by the milk traders. They met Sardar Patel who was from the same region to redress their grievances.

At the initiative of Patel and Morarji Desai, farmers organized themselves into a cooperative union; pressurize the Bombay government with Milk Strike to buy milk directly from their Union.
These farmers registered themselves in Anand, Gujarat in Dec, 1946.
Tribhuvandas Patel, convinced the farmers to form milk cooperatives, later became its chairman and remained so for 25 years.
Dr. Verghese Kurien was CEO of this Union from 1950 to 1973.
Meanwhile in 1955, the Union chose “Amul” the name for its range of products, which competed with MNC companies of dairy products like Glaxo & Nestle.

“Anand Pattern” of Khera cooperative union gradually spread to other districts in Gujarat in 1974.

In 1964, PM Shastri ji wrote to all CMs of the states to set up cooperative dairies on “Anand Pattern”.

To perform this task NDDB (National Dairy Development Board) was created in 1965–Mr. Verghese Kurien was made its chairman.

Beginning of Operation Flood

Drawing heavily from Khera Union for personnel, expertise and much more, NDDB launched “Operation Flood”, a programme to replicate the “Anand Pattern” in other milkshed of country. Operation Flood organised cooperatives of milk producers into a nation-wide milk grid for –

Increasing milk production
Bringing producers & consumers closer by eliminating middlemen
Assuring the producers a regular income throughout the year.

It was not just a dairy programme, but a path to development, generating employment & income of rural households and alleviating poverty.

Impact of Operation Flood

The obvious impact of operation Flood was the considerable increase in milk supply and consequent increase in income of the milk producers, particularly the poor. It was estimated that 60% of the beneficiaries were marginal or small farmers and landless labourers. Milk cooperatives proved to be a significant anti-poverty measure.

Helped in the establishment of an indigenous dairy equipment manufacturing industry
Developed animal nutrition, animal health, artificial insemination management information systems (MIS), dairy engineering, food technology
Operation flood was instrumental in empowerment of women. Operation flood with the help of NGOs like SEWA helped in establishing about 6,000 Women dairy cooperative societies.

Had a spillover effect on other cooperatives too for ex. Cooperatives for fruits & vegetable producers, oilseeds cultivators, small scale salt makers and tree grower were doing excellently well which were initiated by NDDB.

Limitations of Cooperativization

Danial Thorner, the noted economist during his observation of cooperatives found many weaknesses on the cooperative movements. He observed two types of cooperatives in case of joint farming.

One was of rich & landowning farmers. They formed such cooperatives to evade land reforms & access incentives offered by the state. These were bogus kind of cooperatives where big farmers enrolled their labourers & ex-tenants as members.
The other, second type of cooperatives was state sponsored cooperative forms where uncultivated lands of the government made available to landless labourers & underprivileged groups. These cooperatives didn’t live up to their expectations in terms of benefits of scale.

Service cooperatives

Service cooperatives fared better than farming cooperatives, but service cooperatives reinforced casted based hierarchical structure.

Leaders of such cooperatives mostly drawn from traders and money lending communities. Hence no benefits to poor.
Instead of promoting people’s participation in cooperative movement, very soon it became overstaffed with government officials & became inefficient.
Credit cooperatives suffered from major drawback of failure of repayment of loans, which led to large percentage of over-dues.
Contrary to common perception, rich & landowning community were the largest defaulters not the poor and small farmers.