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On March 30 this year, the court had directed CDGK for fixing interim prices of milk till final prices of milk were decided. Petitionerís counsel had filed contempt of court application, seeking action against CDGKís district coordination officer for violating the courtís direction.

On Tuesday, CDGKís law officer produced a notification before the court, issued by DCO Fazalur Rehman, who is also District Controller of Prices, informing the court that interim wholesale and retail prices for fresh milk (containing 5% fat) within the limits of Karachi had been fixed and wholesale price of milk would be Rs 28 per liter and retail price Rs. 30 per liter.

The interim prices, announced by CDGK, was questioned by the petitionerís counsel Naeemur Rehman and Khursheed Javed, contenting that the prices were not based on ground realities as they (retailers) had been purchasing milk at Rs.32.5 per litre from wholesalers.

They submitted that even the prices assessed by Small and Medium Enterprise Development Authority (SMEDA) was Rs. 32.75 per liter and it would be quite impossible for retailers and wholesalers to sell fresh milk at Rs 28 and Rs 30 per litre, respectively, as notified by the CDGK.

The court was prayed to fix the reasonable milk price till the committee reaches final decision. Karachi Dairy Farmers Associationís counsel Kazim Hasan also supported the arguments of the petitioner, informing the court that Director Animal Husbandry (Sindh govt) also confirmed milk production cost at Rs. 33 per liter.

Additional Advocate General Sarwar Khan had also urged for fixing interim price of milk as it related to the public interest.

SHCís division bench comprising Justice Sarmad Jalal Osmany and Justice Ali Sain Dino Metlo, after hearing the arguments and going through the reports submitted by SMEDA and Animal Husbandry Department, ordered that wholesalers should supply fresh milk at Rs.30 per liter and retailers should charge Rs. 32 per liter till the committee decides final prices of milk.

The contempt of court application against CDGKís officials was subsequently disposed of by the court after production of notification by the alleged contemnors.

On March 6 this year the SHC had directed the district controller to fix “fair and just” price of milk from the stage of production cost, wholesale price and retailersí valuation after making consultations with all stakeholders involved in milk business.

(By Jamil Khurshid, The News-13, 11/04/2007)

Crying over overpriced milk

A CONFLICT has arisen between the CDGK and the milk dealers. City Nazim Mustafa Kamal had stated that the government’s duty is to protect the interest of poor people and the government would take all necessary action to ensure that no one challenged its authority.

“The sudden rise in milk prices is a challenge and the government would take necessary action to implement its authority as well as protect the rights of consumers and the poor people of the city”.

As such, on the orders of the nazim, the DCO, the EDO of enterprises and investment promotion and the EDO of municipal services started to clamp down on the wholesalers and retailers of fresh milk.

They held separate meetings between the dairy farmers, wholesalers and retailers and representatives of consumer protection organisations, including Helpline Trust, and had tried to work out prices which were acceptable to all.

However, unfortunately, no agreement was reached and both the wholesalers and retailers refused to accept the retail price of Rs28 fixed by the CDGK.

The dairy farmers stated that the price hike was not their fault, and was due to the high prices of fodder, cattle and inflation. They complained that the committee had not taken into consideration the inherent problems and other factors when fixing prices of milk.

The wholesalers submitted their cost sheet, showing Rs35/litre as their cost, whereas officials of CDGK had calculated a cost of Rs26/litre, a difference of Rs9/litre and rejected the workings of the wholesalers, stating that the figures submitted by them were inflated and misleading.

This led to the dairy farmers in, not only threatening to stop the supply of milk, but also to create a meat crisis in Karachi.

They threatened that they would stop the supply of cows and buffaloes to the meat merchants if the CDGK forced them to sell milk for less than Rs35.50/litre, the price which they have fixed from March 1.

However, the retailers agreed to sell milk at Rs28 per litre, provided the wholesale price of milk was 16 per cent lower, to cover their cost. They stated that they were helpless due to the extraordinary increase by dairy farmers, which had forced them to increase retail prices.

The CDGK reacted in its usual knee-jerk manner. As they had been provided magisterial powers and have been directed by the nazim to ensure that milk is not sold beyond the CDGK-fixed price of Rs28/litre, they started arresting the retailers, thus aggravating the situation further.

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