Karnataka's Nandini urges PM, CCI to probe Rs 1 milk sale on quick commerce platforms

Nandini

• BAMUL calls for investigation into e-commerce milk discounts
• Deep discounts could harm dairy farmers and cooperatives.
• BAMUL warns of disruption to dairy value chain and farmer incomes

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Bangalore Urban, Rural and Ramanagara District Co-operative Milk Producers’ Societies Union Limited (BAMUL) has written to Prime Minister Narendra Modi and Competition Commission of India seeking an investigation into deep discounting of milk by quick commerce platforms, warning that such practices could hurt dairy farmers and cooperative institutions.

BAMUL, one of the largest milk unions under Karnataka Milk Federation (KMF) that markets Nandini brand, said such aggressive pricing could disrupt the dairy value chain and affect farmer incomes.

In a representation dated March 14, BAMUL president and former MP DK Suresh flagged a promotional campaign by Flipkart through its quick commerce service Flipkart Minutes, which advertised milk at Rs 1 per half litre as part of a customer acquisition drive.

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Suresh said the pricing appeared to be significantly below the economic cost of procurement, processing, packaging, transportation, cold-chain management and retail distribution of milk.

A Flipkart spokesperson said in a statement, “Flipkart periodically runs limited promotional campaigns on select products available on the platform, often in partnership with banking partners, to enhance customer value. Prices of products on the Flipkart marketplace are determined by individual sellers. All dairy partners and sellers continue to receive their full agreed price for the products they supply, and farmer procurement prices are not impacted in any way".

“Flipkart remains committed to working with farmers, cooperatives and sellers across India to expand market access and support their growth,” it added.

According to the letter, such pricing may be supported through platform subsidies or investor-backed promotional strategies and could raise concerns under Section 4 of the Competition Act, 2002, which deals with abuse of dominant position.

BAMUL said milk is a livelihood-linked agricultural commodity produced daily by millions of small and marginal dairy farmers who rely on milk sales as a stable source of income. Artificially lowering retail prices could distort the dairy value chain, which stretches from farmer procurement to cooperative processing and consumer distribution.

The cooperative also warned that milk may be used as a 'loss-leader' product to attract consumers to digital platforms, where companies incur losses on one product to increase user traffic and later recover costs through cross-selling of other goods, logistics services or advertising.

Such pricing strategies could also affect neighbourhood retailers and traditional milk vendors, the letter said. Milk purchases often drive daily footfall to small stores and cooperative outlets, where consumers typically buy other groceries at the same time.

BAMUL argued that large digital platforms have access to investor capital and diversified digital ecosystems, enabling them to sustain deep discounting for extended periods-an advantage not available to cooperative institutions whose pricing structures are linked to farmer procurement prices and operational costs.

The letter warned that if such practices continue unchecked, they could lead to distortion of fair competition in the dairy sector, erosion of stable procurement prices for farmers, weakening of cooperative dairy institutions, and loss of livelihoods for small retailers.

BAMUL has urged Competition Commission of India to initiate an investigation into deep discounting in the sale of milk and other farmer-produced commodities by quick commerce platforms.

It has also sought an examination of whether such campaigns amount to predatory pricing or abuse of dominant position, and called for regulatory safeguards to ensure essential agricultural commodities are not subjected to unsustainable loss-leader pricing strategies.

The cooperative said protecting the stability of India’s dairy ecosystem is critical as it supports millions of rural households and has been central to the country’s emergence as one of the world’s largest milk producers.