The Competition Commission of Pakistan (CCP) has imposed fines on three dairy associations in Karachi for their involvement in artificially increasing prices of fresh milk.
According to the PCC, a tribunal comprising Chairman Dr Akbar Sidhu and Member Abdul Rashid Sheikh imposed fines on the Dairy Farmers and Cattle Farmers Association (DCFA) worth Rs 1 million, while the Karachi Dairy Farmers Association (DFAK) and the Karachi Dairy Farmers Association (KDF) were fined Rs 500,000 each.
The move was taken following investigations sparked by media reports highlighting a significant rise in milk prices across Karachi. The investigation revealed that the three associations were directly responsible for the increase in milk prices in and around Karachi.
The associations argued that the prices fixed by the Karachi Commissionerate under the Sindh Price Control of Essential Commodities and Prevention of Speculation and Hoarding Act, 2005 had not been revised for three years despite the increase of inflation.
However, the Commission’s investigation found that the associations had intentionally manipulated the milk supply chain, creating undue pressures and obstacles to inflate prices.
Evidence presented during the investigation, including video recordings, confirmed that the prices declared by the associations applied throughout the entire supply chain. Wholesale and retail suppliers were threatened with supply cuts unless they complied with newly imposed tariffs.
The ruling also revealed that the associations influenced critical pricing factors, such as market rates and wholesale and retail prices, leading to market disruptions. Furthermore, they created an artificial shortage of milk by storing it in ice factories and selling it at inflated prices in interior Sindh. These tactics severely disrupted the supply chain and imposed additional financial burdens on consumers.
