BIRD FLU IN INDIA

The poultry industry in France is worth around US$ 8 billion and France is a leading exporter of poultry products. Japan, a leading importer of poultry products, had already issued a temporary ban on poultry imports from France. As reports of wild birds infected with the bird flu virus came to light in Germany, Switzerland, and Romania, the EU has asked its trading partners not to over-react to the situation as France stepped up its efforts to contain the disease through intensive culling and vaccination.

India is the fifth largest producer of eggs and the ninth largest producer of broilers (chicken) in the world. India’s poultry industry is worth Rs 280 billion annually of which exports of poultry products is around Rs 6 billion. According to O.P. Singh, CEO of Venkateswara Hatcheries (Venky’s), the poultry industry contributes to 1.2% of the nation’s GDP.6 The Middle-East countries are the largest consumer of Indian poultry products along with Japan and Europe.

In the wake of the bird flu scare, the poultry industry faced an estimated loss of around Rs 18 billion in the first few days itself. Ironically it was not the dreaded virus that caused this damage but the panic among consumers, which has resulted in mounting losses to the poultry industry and its affiliate sectors. Although 1.2 million chicken were culled since the outbreak, the mass culling is but a negligible part of the loss. Decrease in demand for poultry in the domestic as well as the international market has been the main reason.

Poultry product exports were badly hit when Pakistan, Nepal, Bangladesh, Sri Lanka, Japan, Bahrain and the UAE, put out advisory alerts against the import of chicken and eggs from India. Venky’s, the leading player in this industry, has already lost an order worth Rs 70 million from Japan. The domestic consumption of chicken and eggs are estimated to have come down by over 50%. The price of chicken has dropped to the tune of 60% in certain markets.

In 2004, a similar scare had led to the loss of Rs 25 billion for the poultry industry in just nine days. Another concern among poultry farmers is the impact this scare will have on the livelihoods of the workers as this industry was labor-intensive. The industry also had backward linkages with other industries like transportation (for carrying chicken), chicken feed industry, and pharmaceuticals (medicine for poultry). The bird flu scare could indirectly affect hospitality and tourism sector, the aviation industry, and the mass-scale retail sector. The insurance and banking sectors would also be affected.

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