Aavin lends Rs 30 cr to milk union to pay farmers’ dues

The Chennai Aavin federation had also lent similar amounts to five financially weak district unions for the same purpose, sources added. Though the usual practice is for the district union to pay dairy farmers their monthly dues in the first week of the subsequent month, the harvest festival of Pongal being hardly 10 days away resulted in the dairy farmers requesting the Vellore dairy to settle dues before the festival.

Accordingly, when the issue came up before the federation, the latter loaned Rs 30 crore to the Vellore unit. “The amount was received two days ago and the dues of the dairy farmers will be settled within the next couple of days,” a top official said.

Asked how the union would repay the loan, the official said, “We have to repay the amount in 10 instalments and though this might sound difficult, we will surely do it.” The move was welcomed by the dairy farmers as the union, caught in corruption-related issues during a Deepavali eve vigilance raid, had dampened their hopes of getting their dues settled before Pongal.

V Kothandaraman, who was made GM (in charge) of the union, had then stated that he would set the facility on its feet if he was given three months. It also his move to to sell Chennai unit 100 tonne ghee to fill the union’s coffers.

Vellore and Tiruvannamalai districts have a total of 65,000 milk farmers attached to 756 active societies that ensure a daily milk procurement of 4 lakh litres. Sources said that repayment will not be an issue as the district union’s move to provide Chennai Aavin with 100 tonnes ghee every month will ensure that Vellore had the resources to repay the loan.