Bengaluru: From our morning filter coffee to our evening snacks, milk is a daily necessity for millions of households in Karnataka, just like in any other parts of the country. From November 1, that routine will become more expensive.
The Karnataka government has approved a Rs 8-per-litre increase in Nandini milk prices, raising the price of toned milk from Rs 46 to Rs 54. While the government says the decision is necessary to support dairy farmers facing rising production costs, the increase has raised concerns about household expenditure and the possibility of further price increases at hotels and eateries.
Under the revised arrangement, Rs 7 of the increase will go to farmers, while Rs 1 will go to milk cooperative unions to meet operational expenses. The government has cited drought-related difficulties, rising input costs and declining milk procurement to justify the decision.
Explaining the move, Minister for Greater Bengaluru Development Krishna Byre Gowda said farmers had been demanding higher prices and had protested to press their case. The Cabinet had decided to increase the procurement price by Rs 7 per litre and allocate another rupee to cooperatives, he said.
For consumers, the impact is immediate. A household purchasing one litre of milk daily will spend an additional Rs 240 a month. For a family consuming two litres a day, the increase amounts to Rs 480 monthly, or Rs 5,760 annually.
Ravi N, an auto driver and a regular milk consumer, questioned the scale of the increase at a time when people are already dealing with economic pressures. “Tea and coffee remain everyday necessities for drivers, daily-wage workers and professionals, even a mild increase in the rate of tea and coffee could hurt lower-income groups,” he points out.
David, a private-sector employee, told the newspaper that he regularly consumed milk and dairy products as part of his health routine. He estimated that the hike could increase his monthly expenditure by around Rs 700. “Salaries and annual increments are not keeping pace with the rising cost of living,” he said, calling for the government to consider the wider impact of price increases on ordinary households.
The increase could also affect Bengaluru's neighbourhood darshinis, tea stalls, bakeries and restaurants, where milk is a key ingredient.
The Bangalore Hotels' Association has warned that the increase could force establishments to revise the prices of coffee, tea, snacks and other food items. The association urged the government to limit the increase to Rs 2-3 per litre, arguing that a smaller revision would have helped businesses absorb the additional cost.
Prashanth Raj, director of Bengaluru-based IDC group, told The Times of India that businesses had been absorbing rising costs for months and that the latest increase was substantial. He said the company might have to raise prices by at least Rs 5.
The additional expense could affect businesses already dealing with rising prices of other ingredients, including rice. However, the extent of any increase in menu prices will depend on individual establishments and their operating costs.
For a customer buying two cups of tea or coffee outside every working day, a hypothetical Rs 5 increase per cup would add Rs 260 to monthly expenditure over 26 days. Someone buying four cups daily would pay Rs 520 more under the same assumption.
These are illustrative calculations, not confirmed price increases across Bengaluru's eateries. Nevertheless, they show how a change in one essential commodity can affect everyday spending well beyond the household kitchen.
The government's argument rests on the need to protect dairy farmers from rising expenditure on cattle feed, fodder, veterinary care and transportation.
Chief Minister D K Shivakumar has defended the increase as necessary to prevent losses to farmers. The government has also argued that Nandini milk remains cheaper than several competing brands in other states.
Before the revision, farmers received approximately Rs 35 per litre through the cooperative system, apart from the existing state incentive of Rs 5. The revised procurement price will rise to Rs 42 per litre, with the incentive continuing.
The decision also gives the Opposition an opportunity to question the Congress government's handling of household expenditure.
The party came to power in 2023 promising five guarantee schemes, including free bus travel for eligible women, subsidised electricity and financial assistance for women heads of households. While these schemes provide material support to beneficiaries, rising prices can offset some of the relief households receive.
In October, Karnataka Assembly Leader of Opposition R Ashoka criticised the government over proposed increases in milk prices and bus fares, arguing that households were facing a growing financial burden. He accused the Congress government of giving money through welfare guarantees while taking it back through price increases.