BENGALURU: The state Cabinet on Thursday decided to hike the Nandini milk base price by Rs 8 per litre. The hike will take effect from November 1.

Citing the need to safeguard the interests of farmers reeling under severe drought, law and parliamentary affairs minister Krishna Byre Gowda justified the price hike, saying rates were still within the range of those in most other states.

Tamil Nadu is the only state where the cooperative union milk rate is Rs 40 per litre.

He said rising prices of other commodities were hurting farmers in the state and that milk supply had dropped by 10 lakh litres due to the drought this year.

Cooperation minister Laxman Savadi said the government also had to consider the possibility of dairy farmers supplying milk to other states if rates were not hiked, potentially creating a milk shortage in Karnataka.

Under the formula agreed upon, the government will ensure that Rs 7 of the increase goes to farmers and Re 1 goes to milk unions in the state.

"While farmers will get Rs 47 (including the Rs 5 given by the government as an incentive for milk production), the milk unions will get Re 1 per litre, keeping in mind the increase in transportation costs and packaging rates due to the rise in plastic prices," the two ministers said.

When asked about the impact of the hike on consumers, Byre Gowda and Savadi said farmers, milk unions and legislators had sought an increase of Rs 10 per litre, but negotiations brought it down to Rs 8 to limit the burden on consumers.

Byre Gowda said the government had to manage the expectations of dairy farmers, milk unions and consumers before arriving at the Rs 8-per-litre hike.

"Accordingly, the price of ghee, butter, cheese and other milk products will be hiked by the KMF," Savadi said.

Comparative rates of base price of milk

- Current: Rs 46 per litre

- From November 1: Rs 54 per litre

- Delhi: Rs 59 per litre

- Gujarat: Rs 57 per litre

- Maharashtra: Rs 59 per litre

- Rajasthan: Rs 56 per litre

- Telangana: Rs 64 per litre

- Kerala: Rs 56 per litre

- Tamil Nadu: Rs 40 per litre