Coop dairies hit hard as payments stuck in banks

Sarbjit Dhaliwal

Tribune News Service

Chandigarh, December 8

There is a lot of hue and cry in the countryside as even the Cooperative Milk Producer Societies are not getting their due payment against the milk supplied to the milk plants of the Punjab State Cooperative Milk Producers’ Federation (Milkfed).

Even after 30 days of demonetisation, people continue to face a lot of problems due to cash crunch in banks.

Besides the cash crunch, the restrictions imposed on the banks for payment by the Reserve Bank of India has become a stumbling block in the payment to the cooperative milk producer societies.

There are about 2 lakh members of these societies which supply about 15 lakh litres of milk daily to various milk plants working under the overall management of the Milkfed. The Milkfed deposits the money in various branches of the cooperative banks for further payment to milk producer societies.

“We are depositing about Rs 47 crore after every 10 days with the cooperative banks for payment to milk producer societies supplying milk to various plants. At our level, there is no delay in the payment,” said Amarjit Singh, Chairman of Milkfed.

On being asked in this connection, Jasbir Singh of the Batlana milk producer society said, “There are problems as each society has single account in the cooperative banks, which cannot pay more than Rs 24,000 to a society per week because of the restriction imposed by the RBI. There are two societies in our village with a total member more than 50. Members supply milk worth Rs 3 lakh in 10 days but they get about Rs 48,000 per week from the bank due to controlled payment of cash by the banks.”

“Now, we are opening the accounts of all members separately and then a resolution will be given to the bank to put the payment into the account of each milk supplier separately,” he added.

Narrating a similar story, Bikram Singh of the Gige Majra society said, “We should get about Rs 1.2 lakh after 10 days as payment of the milk from the bank. But we get just Rs 90,000.”

Jasbir Kaur of the Dharmgarh Society said milk producers were facing problems due to inadequate flow of cash.

Former chairman of the Mohali milk plant Parminder Singh Chalaki said, “The milk sector is in trouble due to cash crunch. Milk producers have to spend a lot of money to procure cattle feed, but due to inadequate payment they are unable to give proper feed to their livestock.”

The state government should take up this issue with the RBI. “All restrictions imposed on cooperative sector banks should be removed because these have put the rural economy in doldrums,” he said.