Buffalo meat exports are thriving under Modi govt, but worries remain
Most of Indian business rejoiced when the Narendra Modi-led Bharatiya Janata Party (BJP) swept last year's general election. But one section viewed the results with trepidation, fearing for its future - meat exporters. Given its Hindutva leanings, the BJP's distaste for meat was no secret. Modi had stoked further worry during his election campaign by accusing the erstwhile United Progressive Alliance (UPA) government of promoting a 'pink revolution' - a reference to the colour of raw meat - through policies which encouraged slaughterhouses and meat exporters.
The fears have been belied. With the new government taking charge in May last year, growth in meat exports did indeed see a dip in the April to June quarter. While exports rose 24 per cent in April 2014, shipments slowed in next two months - growth was a modest 10 per cent for the April to June period. But it has recovered since, rising 16 per cent in the first half of 2014/15 and 17 per cent in the first 10 months. Meat export is now a $5 billion industry, not only replacing basmati rice as the biggest revenue earner in India's processed foods category, but also making India the world's second-biggest meat exporter.
The supportive policies Modi railed against remain in place - the government still offers a grant of up to Rs 15 crore to set up new abattoirs or modernise existing ones. More and more players are jumping in - leading B2B online marketplace IndiaMart saw a 20 per cent increase in registration of meat exporters in the past year. "India is among the world's largest meat exporters and there are reasons for it," says Sirajuddin Qureshi, Chairman and Managing Director of Delhi-based Hind Agro Industries Ltd, one of the leading meat processors and exporters in the country.
What are the reasons? The primary one is pricing. Indian meat is almost 20 per cent cheaper than Brazil's mainly because Brazil rears cattle specifically for slaughter, which is expensive, while in India water buffaloes - at least the female ones - are sent to the abattoir only after they grow old and stop yielding milk. A secondary reason for Indian meat's popularity in the Persian Gulf countries and others with large Muslim populations is that buyers are assured it is halal - slaughtered in the manner Muslims consider ritualistically appropriate. Indian meat is exported to 65 countries, the biggest markets being Vietnam (40 per cent), Malaysia (nine per cent), Thailand (seven per cent) and Saudi Arabia (six per cent).
Still, some disquiet remains, as evinced by the refusal of some in the business - including the owners of the biggest export house, Allanasons - to speak to Business Today. The BJP's discomfort with the meat industry is far from overcome, as the Maharashtra government's blanket ban from early March, on the sale and even possession of beef, with harsh penalties for offenders, showed. Vigilante attacks on trucks carrying cattle have also increased in that state. Haryana, another BJP-ruled state, has followed suit with a ban. The BJP's sister organisations - the Rashtriya Swayaksevak Sangh (RSS) and the Vishwa Hindu Parishad (VHP) - continue to clamour for a total ban on meat export.
The bulk of the meat exported is buffalo - and therein arises part of the animus. Buffalo meat is sometimes erroneously referred to as 'beef', which it is not. There are restraints on the processing or sale of beef - normally cow meat - since the cow has religious significance for Hindus. Accordingly, cow slaughter has been either banned or severely restricted in most Indian states - barring Kerala, West Bengal and some northeastern ones - for decades, the ban reinforced by a Supreme Court judgment in 2005. It is buffalo meat, against which there are no religious or legal strictures, which is processed and exported. India's foreign trade policy expressly forbids export of cow meat.
The campaigners insist cow meat continues to be illegally sold - and even exported - under the guise of buffalo meat. "If you ask for Indian cow flesh in Dubai, you can get it," says Ashoo Mongia, President, Rashtriye Goraksha Sena, one of the activist groups. "We hope the Modi government will act against meat exports." The industry dismisses the charge. "After investing so much and building a market, who would take the risk of ruining it all by selling cow's meat clandestinely?" says Sunil Sud, Partner at Delhi-based Al Noor Exports, which runs a meat processing unit at Muzaffarnagar in Uttar Pradesh.
Other objections include Union Minister for Women and Child Development Maneka Gandhi's charge last September - citing a police report - that some of the meat industry's funds were being used to back terrorism. "Money through trade of slaughtered animals goes into terrorism, therefore into killing us, why are we allowing this?" she was quoted as saying at a Jaipur event. The industry calls the allegation baseless.
An Uttar Pradesh based dairy player - who preferred not to be named - also expressed the fear that rising slaughter of female buffaloes could affect milk availability in coming days. But Mohammad Ali Qureshi, President, Bombay Suburban Beef Dealers Association, notes that lactating buffaloes cost so much more that slaughtering them makes no sense. "The average price of the buffaloes we buy is around Rs 25,000, while that of a milk yielding buffalo is Rs 50,000," he says. "Besides, why would a farmer sell a buffalo for slaughter when it is generating daily income?" On the contrary, after farmers sell their aged buffaloes, they usually reinvest the money in young, milk yielding cattle, increasing their overall milk production. "As milk production rises, so does buffalo meat production and export," says Al Noor's Sud.
A visit to the districts of Meerut, Aligarh and Muzaffarnagar in western Uttar Pradesh - the state is the country's meat hub, exporting $3 billion worth per year - shows rearing buffaloes has indeed become much more popular than keeping cows. "A cow has to be fed till it dies, while a buffalo can be sold once it stops giving milk," says Sud. Nor is the phenomenon confined to Uttar Pradesh. "Booming meat export has triggered large scale farming of buffaloes in states like Maharashtra and Punjab," says Mohammed Ather, Managing Partner of New Delhi-based meat exporters, the Azan Group.
Many meat processors have entered into arrangements with buffalo farms to ensure steady supplies. While females are retained by farmers so long they give milk, males are sold much earlier. "Farmers sell us male buffaloes aged six months and we look after them till the age of 18 months," says Hind Agro's Qureshi. "This ensures healthy growth before they are slaughtered." Hind Agro has its own buffalo farm which houses around 35,000 animals at any time. For further supplies, meat processors turn to open markets. "There are regular cattle fairs in villages where aggregators pick and choose animals and sell them to us," says Sud. "We also procure from livestock mandis."
Some in the trade, which is dominated by Muslims, suggest the real reason for the animus is a bias against their community. "This business has a lot of potential but is becoming a victim of religious differences," says Ather of the Azan Group. Others are quick to point out that it is not only Muslims who benefit from it. Hind Agro's Qureshi says half his employees at the Aligarh plant are non-Muslims. "We have packaging, administrative and technical staff, not all of whom are Muslim," says an executive of a company with meat processing units in Punjab, who does not want to be named. "The transporters are also usually non Muslim."
Still others allege the opposition to the animal slaughter industry is actually a racket. "Activists stop vehicles carrying buffaloes en route to slaughterhouses and register police complaints alleging violation of animal rights," says Beef Dealers Association's Qureshi. "The police seize the animals but pass them on to the same activists to look after as there is no lock up for cattle. In most cases, the charges do not stand up in court, but the process takes three to four years. When the trader tries to get back the animals, the groups which stopped him ask for around Rs 40,000 per animal as upkeep charges. Since the animal can be sold for only around Rs 25,000 to Rs 30,000, the trader prefers to forfeit it. It is then sold back into the market."
Exporters are trying their best to ignore these pinpricks and concentrate on expanding their markets. Two large, new markets are likely to be added soon - Russia and China. Russia has approved buffalo meat imports from India after its Western sources dried up, following the sanctions imposed on it by West Europe and the US over the Ukraine standoff. "India can expect $500 million to $1 billion increase in buffalo meat exports once shipments to Russia picks up," says Santosh Sarangi, Chairman, Agricultural and Processed Food Products Export Development Authority, a division of the Commerce Ministry, with which all abattoirs and meat processing plants have to register. So too, India and China signed a memorandum of understanding in 2013 over China providing market access to Indian meat. "It is well known that much of our meat exports to Vietnam ultimately reach China," adds Sarangi. "Direct access to China will lead to another quantum jump in exports."
FLESH AND BONE
Examining the entrails of Indian buffalo meat exports
Meat exported from India, which comprises mainly buffalo meat, is not consumed directly as a dish. It is mostly used in products such as hamburgers and sausages. Buffalo meat is lean and blends well with other ingredients in making value-added products.
The product has to satisfy the standards laid down by the Hazard Analysis Critical Control Point (HACCP), a globally recognised food safety check. Every buffalo, whose meat is intended for export, must have an identifi cation tag to facilitate traceability if required later. It has to be rested for 24 hours - to relax its muscles, which is said to improve the quality of the meat - and examined by a veterinary doctor before being taken to the slaughterhouse. The doctor checks for diseases and pregnancy - killing sick or pregnant animals is disallowed.
"Hygiene is a priority in meat processing units," says Mohammed Ather of the Azan Group. "If hygiene is compromised, the shelf life of the meat reduces and buyers are lost." Uniformed men and women, wearing caps and gloves, de-bone the buffalo after slaughter. The temperature inside is always maintained at around 12 to 15 degrees C. The packaging is mostly handled by women, with the packed meat stored in freezers at temperatures of around minus 20 degrees C. It is taken to ports - Pipavav and Mundhra in Gujarat and Jawaharlal Nehru Port in Maharashtra are the main departure points - in refrigerated containers, where it is subject to tests in a government laboratory and issued a comprehensive health certifi cate testifying to its fi tness.
Different parts of the slain buffalo sell at different prices. The flesh from the hindquarters fetches a better price than that from the forequarters. But fl esh is not all that is sold. So too is the offal - heart, liver, kidney, etc. - albeit at a much lower price.
"Offal is in great demand in China where both humans and pets consume it," says an abattoir worker. So too are the buffalo's bones and blood, which are sent to a rendering facility and processed into meat bone meal, used as poultry feed or soil manure locally. Even the fat is processed into tallow - used in soap and toothpaste - while the skin too has numerous uses.
