The children in the villages around the Indian city of Nabha in Punjab state all know what Horlicks is, although few have tasted it. The malted milk drink, manufactured by GlaxoSmithKline (GSK), is produced at the Horlicks plant in Nabha, which sources from around 1,500 dairy farmers in the surrounding area.
But after several years of severe drought in a region already heavily reliant on groundwater, water reserves are in decline and fodder for cows is becoming more expensive. This is making dairy production increasingly difficult in one of the highest milk-producing states in the country – itself the world’s largest national producer of dairy.
GSK is not the only big business facing drought-related problems in Punjab. Danone buys 50,000 – 80,000 litres of milk from 5,000 farmers in 100 villages in the state, and Nestlé sources more than 300m litres of milk from 100,000 farmers in three Indian states, including Punjab.