The name of Heritage Foods is synonymous with that of Telugu Desam Party Chief and former Chief Minister of Andhra Pradesh Nara Chandrababu Naidu. The Heritage Group founded in 1992 with three-business divisions – Dairy, Retail and Agri has extended its business in four states. With an annual business of Rs 4,000 crore, it has created employment opportunities for thousands of people in the state. But now AMUL’s entrance in the state has led to trouble brewing for Heritage Dairy Company, foreshadowing a political fight.
Andhra Government signs MoU with AMUL
It is learnt that efforts are being made by the AP Government to wipe out Heritage Dairy business from the state. Recently, the state government roped in AMUL – the Indian dairy cooperative society, based at Anand, Gujarat to Andhra Pradesh. A MoU has also been signed in this regard. As per the agreement, AMUL has assured to pay the highest remunerative prices for dairy farmers by setting up over 6000 milk collection centres. However, people have understood that top YSRCP leaders are behind the move.
It seems that the YSRCP chief wants to target TDP’s financial base, and that it’s possible only by disrupting Heritage Dairy business. Talks among TDP circles is that a good brand like AMUL is being roped in only to damage Heritage Foods.
Milk collection via Rythu Bharosa Kendras
Efforts are on to set up Rythu Bharosa Kendras in every village by YSRCP leaders, with such Kendra’s already set up in major mandals and panchayat. AP CM YS Jagan already announced his plans to provide good prices for farmer’s produce through these Rythu Bharosa Kendras besides the distribution of fertilizers, seeds and insecticides. In addition, even milk collection is being introduced. The state government is investing Rs. 500 crore towards developing basic amenities. Now, milk collected at these centers will be supplied to AMUL and in return the dairy farmers will be paid high remunerative prices.
Intense competition in milk collection
Milk collection has now turned a challenge for dairies with private players emerging in the business, trying to buy milk directly from the farmers. Even, Vijaya Dairy a significant brand name during the 1980s and ’90s, failed due to the successive governments’ encouraging private players in the dairy industry. The intense competition between the private companies has led to each litre of milk costing Rs. 58 currently. In these circumstances, the state government backing AMUL will definitely disrupt the business of Heritage Dairy.
Additional Rs. 2 for a litre of milk
The AP government mulls to pay an additional Rs. 2 for a litre of milk provided by dairy farmers, similar to the system which is being implemented in Telangana. If this continues, then undoubtedly private and co-operative milk producers will face tough times. It will take another year to see how YSRCP’s plans to disrupt and disturb Heritage turns out.
