Focus on Arts and Ecology

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China set to lead global electrolyser installations in 2024

October 10, 2024 

China is set to lead global electrolyser installations with nearly 70% of projected capacity this year, according to the International Energy Agency’s (IEA) Global Hydrogen Review 2024.  


Electrolysers, which use electricity to split water into hydrogen and oxygen, are a critical technology for producing low-emissions, or “green” hydrogen, from renewable or nuclear electricity.


By the end of 2023, installed electrolyser capacity reached 1.4 GW globally, with projections indicating it could rise to 5 GW by the end of 2024, primarily driven by projects in China, the report notes.


Despite global hydrogen demand reaching 97 million tonnes in 2023, green hydrogen production remains below 1 million tonnes, with most of the demand still being met by “grey” hydrogen produced from fossil fuels. In China, green hydrogen similarly accounts for just 1% of total hydrogen production.


According to the IEA report, 60% of the world’s electrolyser manufacturing capacity is currently located in the country. With expanding production capabilities, costs for electrolysers are expected to decrease further, following a similar trend observed in the solar photovoltaic and battery industries.


As local governments announce ambitious plans, China’s hydrogen sector is anticipated to grow rapidly. However, slow infrastructure development and weak consumption demand could pose risks of overcapacity, the South China Morning Post noted last year.


This trend also extends to the export sector. In late August, China Daily reported that Chinese hydrogen electrolyser exports have been experiencing an unprecedented surge due to growing demand for sustainable solutions in Europe and the Middle East. However, in September, the European Union announced that it will take steps to exclude Chinese-manufactured electrolysers from an upcoming auction in a bid to reduce competition.


“The development of China’s hydrogen industry is unbalanced,” said Guo Jianzeng, a director of the 718th Institute of the China Shipbuilding Industry Corporation, its research-focused arm. He added that the bottleneck in hydrogen storage and transportation has not been paid enough attention, while investment in areas such as electrolysis and hydrogen fuel cells is currently overheated.


Some in the industry have sought to assuage these concerns. They say that the “capacity” in “overcapacity” refers to the planned capacity and not actual output, and that whether the capacity will be implemented remains uncertain.  


“Due to the complexity and bespoke nature of electrolyser equipment, manufacturers do not choose to produce more products for inventory,” noted a Chinese hydrogen company chief. “They will only produce when there are orders.”


(Sources: Dialogue Earth)

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Grumble in the jungle: Sinohydro’s difficult decade in Bolivia

The Chinese construction firm has six projects in the country but has struggled to win over the public, facing complaints over environmental harms, labour issues and quality of works. 

Building works for the Ivirizu hydroelectric plant, in Cochabamba, Bolivia, one of six projects undertaken in the country by Chinese construction company Sinohydro. The project has faced criticism from civil society organisations over its environmental impacts (Image: Agencia Boliviana de Información)

In the early hours of 6 May, a jaguar was run over by a vehicle near the site of works to widen a section of the Cochabamba-Santa Cruz highway, in central Bolivia. The incident would have gone unnoticed had it not been for what happened to the animal’s body.

After being alerted to the incident by locals and rangers, agents from the Forestry and Environmental Preservation Police (Pofoma) discovered its dismembered head and three of its limbs, half-buried, along with its full hide spread on a board, in a camp belonging to the Chinese company Sinohydro, which was in charge of the works.

Government officials told media that they suspected the parts were dismembered with the intention of being sold. The parts were recovered by authorities, and three Sinohydro employees – two Bolivian and one Pakistani – were linked to the incident, though no arrests were initially reported, nor had the driver who struck the jaguar been identified. The Pakistani worker is said to have voluntarily handed over the jaguar head and four of its teeth, according to a police report seen by Dialogue Earth.

At least five national laws in the country protect animals and punish biocide and wildlife trafficking with up to eight years in prison. The jaguar, classified as “near threatened” according to the International Union for Conservation of Nature, is being conserved in Bolivia under a national plan. The Public Prosecutor’s Office therefore opened an investigation to determine who was responsible. Sandra Montaño, legal advisor to the Cochabamba Departmental Secretariat for the Rights of Mother Earth, a state environmental body, said that the Cochabamba government has joined the legal process.

The incident gained national prominence due to gory photographs of the animal carcass circulating on social media.

Three other Sinohydro employees, from its legal, human resources and environmental departments, were reported by local media to have assisted police authorities in the recovery of the animal parts, while the two Bolivian workers allegedly involved in the incident were reported to have left the company camp soon after. But the incident has been another potentially damaging episode for Sinohydro in Bolivia, where it has faced challenges since it arrived in the country in 2013.

The Chinese constructor – a subsidiary of state-owned PowerChina – is involved in six road infrastructure and energy projects in Bolivia, but has been the subject of complaints from environmental organisations and government officials, related to is record on deforestation around project sites, labour disputes, and the quality of the works it has delivered.

Environmental complaints

The company’s name first appeared in Bolivian media as the subject of environmental complaints in 2017. Tomás Monasterio, then a congressman for the opposition Democratic Party, filed a criminal complaint against Sinohydro over the deforestation of 6.8 hectares of trees on the banks of the Surutú River in Santa Cruz department, which he said increased flood risk and put local communities in danger. Almost a month later, he filed a second lawsuit against the company for deforestation of a further 1.8 hectares, this time on the banks of the Piraí River, which took place despite regulations prohibiting any logging within 100 metres of a river for environmental protection. Both instances took place as part of the construction of the Montero-Yapacaní dual carriageway in Santa Cruz.

The former parliamentarian described these incidents to Dialogue Earth as “a savage clearing”. During an inspection in Surutú, he reported that personnel from the Forestry and Land Authority (ABT) also found “buried toxic waste”.

The ABT announced the issuing of a fine of around BOB 14,000 (USD 2,018) for the first case, along with an order to reforest the entire area, and a doubling of the fine for the second. In both cases, the ABT confirmed that there was no authorisation to clear the land. But Humberto Nazra, the Bolivian Highway Administration’s (ABC) works prosecutor, told media that he did not believe Sinohydro acted in bad faith, and said the company had acknowledged its mistakes and was complying with orders issued to it by authorities.

Monasterio then filed a third criminal complaint. He said that as he was undertaking an inspection of the deforested Surutú site, a group of local community members – which he claimed consisted of Sinohydro employees and people supportive of the company and politicians who approved the projects – “held me back and threatened to lynch me, and I had to flee from Surutú”.

The former deputy says he was surprised to be informed, when his legislative term ended in 2021, that his three complaints were all rejected due to allegedly insufficient evidence, despite the environmental crimes committed being demonstrated and already subject to fines.

The Ivirizu case

Sinohydro has faced further criticism on its environmental performance in Bolivia, being mentioned before the United Nations Committee on Economic, Social and Cultural Rights (CESCR) in 2023. The case of the Ivirizu hydroelectric plant, under construction in Cochabamba, was highlighted by Franco Albarracín, a researcher at the environmental civil society organisation Cedib, who presented a report to the committee evaluating China’s business activities in Latin America and their compliance with international obligations and human rights laws.

He highlighted to the committee the company’s hydroelectric power plant, which he claimed as having “already affected 280 hectares of forest within the protected area [of the Carrasco National Park, within which the plant is located], which clearly has a negative and probably irreversible impact on flora and fauna”. Albarracín added that the construction has “affected 18 communities in the municipalities of Totora, Mizque and a large part of the protected area”.

Construction at the Ivirizu hydroelectric plant. One researcher claims that works have already affected 280 hectares of forest within the protected area of the Carrasco National Park, where the project is located (Image: Ministry of Hydrocarbons and Energy of Bolivia)

Marco Gandarillas, head of monitoring Chinese investments at Ecuador-based NGO Latinoamérica Sustentable, highlighted the “complicated” nature of the Ivirizu project, “from deforestation and the treatment of deforestation waste, to the [power plant] itself”. Additionally, he claimed that there have been reports of incursions into the protected area by “colonisers” (a term often used in Bolivia to refer to people from the Andean region who seek land in the tropical zone), which he said has been made possible by the project’s creation of roads and paths for the movement of workers and materials.

In order to carry out this project – which Bolivian public utilities company Ende stated in 2016 would be used to generate surplus electricity for export – a Cedib dossier notes that the zoning of the protected area was modified for the development of the project, which was declared “of national interest and priority” by the government only a month before the modification. In May 2023, the Ministry of Hydrocarbons and Energy announced the project was “more than 86%” complete.

Additionally, when more than 50 Bolivian environmental organisations sent a letter in 2020 to Sinohydro, one of the requests made was that they make public the environmental studies, in which they stated that the intervention of the power plant in the park “will have irreversible impacts”, reports Gandarillas. “But both the company and the Bolivian authorities refused,” he adds.

Sinohydro has not responded directly to these issues, and did not respond to Dialogue Earth’s approaches for comment. In a 2023 article published on the website of parent company PowerChina, it referred to the obtaining of environmental impact assessment and tree felling permits in 2018, and emphasised the project’s attempts to adhere to Bolivian environmental law, claiming that it had “strictly followed” environment protection measures and “ensured that local ecology is not damaged”.

On its official website, Ende states that Ivirizu is a “sustainable solution” to Bolivia’s energy challenges. It also claims that environmental impact studies were carried out, and “prevention and mitigation measures were implemented to protect biodiversity and local ecosystems”. Additionally, the website states that Ivirizu is “the first project in Bolivia” to implement rescue plans for flora and fauna such as amphibians and reptiles as a mitigation measure as part of its environmental licence.

Labour and quality claims

In 2021, Sinohydro was also linked to alleged labour violations in Ivirizu, revealed by the Ombudsman’s Office, whose report also pointed to a lack of action taken by the Ministry of Labour. These related to subcontracting and outsourcing, as well as poor conditions in workers’ lodgings.

Disputes were also reported in the construction of the Padilla-El Salto highway in Chuquisaca department in 2018, where a Chinese Sinohydro employee was arrested after allegedly attacking a woman working for one of its subcontractors, who was protesting about its failure to pay her wages. The incident sparked wider hostilities, with workers from the subcontracted company and other local organisations blockading Sinohydro’s camps. The company initially denied the accusations, saying that payment was the responsibility of its subcontractor, and claimed on the contrary that its workers were the victims of the incident, having been forcibly prevented from entering its camp. However, it was later reported to have paid the missed wages and agreed to remove the employee involved in the alleged assault from the project.

A tunnel under construction in Cochabamba, part of the El Sillar dual carriageway project. A company subcontracted by Sinohydro for this project was sued for failing to comply with labour and industrial safety regulations (Image: Agencia Boliviana de Información)

In another project, the El Sillar dual carriageway – which links Santa Cruz with Cochabamba – Mikenny, a separate company subcontracted by Sinohydro, was also sued for “non-compliance with labour and industrial safety regulations” in 2022. Between 2015 and 2019, the non-profit Centre for Labour and Agrarian Development Studies (Cedla) logged 153 complaints against Sinohydro related to labour issues in Bolivia – the highest amongst 17 Chinese companies active in the country during the period – and six “conflicting projects”, or ones that have caused environmental and labour conflicts.

The El Sillar project was delivered and opened in November 2023, but subsequently received complaints from the ABC after the press recorded sinkholes and collapses in at least ten sections of the road, leading the authority to demand guarantees from Sinohydro on repair work. This work is still ongoing, and is close to where the jaguar was struck.

Dialogue Earth attempted to contact representatives of Sinohydro to discuss the issues raised in this article, but was unsuccessful. An exhaustive review of local media showed that the company issues press releases on social issues, but rarely gives interviews. In one of the few available, given by a Bolivia branch manager in 2016, he sought to defend the company amidst delays in several of its projects. In December 2023, another was given by a branch manager stating the company’s commitment to conducting repair works on the El Sillar project.

Both Cecilia Requena, a current senator from the opposition Civic Community party and a noted environmentalist, and the then-deputy Monasterio told Dialogue Earth that they had requested reports from various ministries in relation to the environmental complaints against the Chinese firm.

In June, a month after the incident involving the dismembered jaguar was publicised, Requena sought more information from the Ministry of Government on the nature and progress of the police intervention in the case; from the Ministry of the Environment, to learn more about the environmental licences given to Sinohydro; and from the Ministry of Public Works, to understand the impact on wildlife, among others. At the time of publication, she said the authorities had yet to respond.

Gandarillas, of Latinoamérica Sustentable, says that though the Chinese state itself has established control mechanisms and policies surrounding sustainable development in its companies overseas operations, its entities have not always complied with them. “Sinohydro has sustainable development policies, but they are little known outside China,” he notes. “In fact, China also has open and effective dialogue mechanisms to facilitate the exchange of information on issues of common interest, such as environmental issues.” In 2020, the NGO compiled these policies into a report published in Spanish, but Gandarillas says there has been no response to its publications.

Following the UN CESCR review in 2023, as part of which Latin American NGOs filed their report on Chinese investments in the region, the Chinese government issued a response stating its intention to study the findings and “fulfil its obligations under international human rights instruments”. It said it “will continue to engage in constructive dialogue and cooperation with all parties”.

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Brazil edges closer to China’s Belt and Road. Why now?

Signals from Brasília suggest the country may finally sign up to the Chinese initiative, as Lula’s government weighs up economic benefits, infrastructure goals and strategic gains. 

Chinese leader Xi Jinping and Brazilian president Luiz Inácio Lula da Silva at a welcoming ceremony in Beijing, April 2023. During a four-day Brazilian state visit, the two countries signed 15 agreements, but none mentioned the possibility of Brazil joining the Belt and Road Initiative (Image: Ricardo Stuckert / Palácio do PlanaltoCC BY)

As China’s Belt and Road Initiative enters its second decade, the country appears on the verge of persuading Brazil to make the significant decision to finally sign up to its flagship overseas investment programme.

Recent statements by Brazilian President Luiz Inácio Lula da Silva have heightened speculation that the country will join the vast infrastructure initiative. So, what has changed, and what would this mean for Brazil, China, and the region’s politics and economics?

Launched in 2013, the Belt and Road Initiative (BRI) has been championed by Chinese leader Xi Jinping as a scheme to create modern trade routes that echo the historic Silk Road. Having greatly expanded the international presence of Chinese companies and finance, the BRI has been seen as a strategic endeavour to increase China’s global influence, while officials have sought to cultivate a narrative of enhancing economic, political and cultural ties among its members.

Originally intended to link Asia and Europe through Africa and the Middle East, the initiative expanded to Latin America in 2017. China has invested in nearly 150 countries, including 22 in Latin America and the Caribbean, with total commitments passing the USD 1 trillion mark in the first half of 2023. These investments have primarily taken the form of loans and contracts for major infrastructure projects, such as power plants, roads, airports, seaports and dams.

Following a period of hesitance under presidents Michel Temer (2016-2018) and Jair Bolsonaro (2019-2022), Brazil – with its abundant resources and important position within South America – has once again come to the fore in discussions of the BRI.

“Brazil has understood for a very long time that it’s a key partner for China in Latin America, regardless of its decision to join the Belt and Road Initiative,” says Margaret Myers, director of the Asia and Latin America Program at the Inter-American Dialogue. “It’s been a top destination, if not the top destination, for Chinese investors. This is unlikely to change.

“At the same time, Brazil views itself in many ways as like China – an emerging power,” she adds. “I don’t know if joining the BRI would have, in some form, diminished Brazil’s own views of its interests in the region and globally, but that’s potentially one consideration.”

Lula’s return a key factor

While Brazilian diplomats have remained sceptical of the benefits of BRI membership, speculation that Brazil might sign a memorandum to join the initiative has steadily grown since Lula returned as president at the start of 2023.

Recent visits to China by Lula and his vice president, Geraldo Alckmin, took place without any announcement on the Belt and Road. However, during an event in July, Lula did suggest Brazil might join: “As China is interested in discussing the Silk Road, we need to prepare a proposal to discuss what’s in it for us,” he said. “What advantages does Brazil stand to gain from participating? What significant role will Brazil play?”

With Xi set to make a state visit to Brazil for the G20 conference in Rio de Janeiro in November, and the two presidents also meeting that month at the Asia-Pacific Economic Cooperation (APEC) summit in Peru, Chinese officials are keen to seal the deal during the 50th year of Brazil-China relations.

“There is a different perspective between the president’s inner circle and the foreign ministry,” says Pablo Ibañez, geopolitics professor at the Federal Rural University of Rio de Janeiro. “Lula knows the value of growing relationships with the Global South and prefers to foster relations outside of the axis of the United States and Europe.”

Ibañez says the foreign ministry “is very concerned about the implications”, however. He adds: “What can we gain from it? Could it bring reprisals from the United States? The Belt and Road is another stage in the expansion of Chinese global power. It is enormous, and it is fundamental to the Chinese government.”

President Lula hosts a meeting with Chinese foreign minister Wang Yi at the Fortaleza air base in Brazil’s north-east. Experts say Brazil is hoping to boost cooperation between the two nations in areas beyond commodity exports, the key driver in cementing China’s position as its top trading partner for the last 15 years (Image: Ricardo Stuckert / Palácio do PlanaltoCC BY-ND)

According to experts interviewed by Dialogue Earth, Brazil is carefully weighing the potential benefits of joining in an attempt to extract maximum leverage from China’s negotiators.

“A few years ago, I believe Brazil did not have a clear understanding of the strategic reasons for joining the BRI,” says João Cumarú, a researcher at Plataforma CIPÓ, a climate and foreign affairs NGO. “Now, however, some members of Lula’s government are beginning to think strategically about what Brazil should ask for in return for its involvement.”

The specifics are uncertain, but specialists say Brazil is likely looking for support that goes beyond the export of commodities to China and the import of finished goods in return.

China has been Brazil’s largest trading partner since 2009, with bilateral trade between the nations reaching USD 80 billion in the first half of 2024, according to Brazilian foreign trade data. But around 80% of Brazil’s exports to China consist of just three items: petroleum, iron ore, and soybeans.


Last year, during his visit to Beijing, Lula signed 15 agreements, including on space technology, renewable energy, climate cooperation, electric mobility, and green finance.

Cumarú believes there are three key areas in which Brazil should aim to seek benefits from BRI membership: “Green energy and technology cooperation, particularly in the context of the energy transition; reindustrialisation efforts that look to add value to our commodities by interpreting Chinese technologies for land recovery and sustainable practices, and infrastructure projects planned by the government, particularly as they pertain to integrating South America [into] various transport routes.”

The researcher added that, during his conversations with Brazilian government figures, engaging with China on finance has been another topic of particular interest. “They were looking into how the Chinese could finance part of the federal government’s new industrialisation, ecological transformation, and energy transition programmes. At that time, there was an initial idea that the BRI could be a financing avenue for these projects.”

A changing Belt and Road

The BRI has evolved significantly since its early days, and Chinese leadership has signalled a desire to pivot the initiative towards a focus on “small but beautiful” diversified investments in green or innovation sectors, rather than the large infrastructure projects emblematic of its first decade.

“China is struggling with how to define the BRI in this new phase,” says Myers. “We’re not going to be seeing the same degree of large-scale infrastructure development as in the past.”

On the Brazilian side, things are also complex. Potential investments from China in electric vehicles in Brazil, for example, have raised concerns within the domestic industry, Cumarú says.

However, it would be unwise to rule out the possibility of a large infrastructure investment to seal the deal, the experts suggest. Brazil faces a significant shortfall in infrastructure investment, with a World Bank report suggesting the country needs to allocate USD 778 billion to close this gap by the 2030 aim of the United Nations’ Sustainable Development Goals.

Last year, Lula announced a new Growth Acceleration Program (PAC) to spend BRL 1.7 trillion (roughly USD 300 billion) on infrastructure, energy and transportation over four years.

“China is trying to elevate this to a new level of negotiations,” says Ibañez. “The Chinese ambassador in Brazil recently gave an interview to CNN Brasil, discussing the importance of investment in Brazil and the region. He mentioned that China could help Brazil with the PAC. This indicates that Brazil’s involvement in the Belt and Road is increasingly becoming a reality.”

Another point of interest is the long-mooted Central Bi-Oceanic Railway Corridor, a proposed 3,750-kilometre railway linking the Pacific Ocean to the Atlantic Ocean through Peru, Bolivia, and Brazil. “I’ve heard rumblings lately that this project is still being considered and is being discussed in relation to the Chancay port development, so it is not dead,” says Myers. The Chancay port in central Peru is one of the largest investments to arrive in Latin America under the BRI, and is set to be inaugurated in November, at a ceremony likely to be attended by both Xi and Lula.

Chinese financing of the proposed railway would align well with Lula’s objective for greater integration among South American countries, led by Brazil. Last year, he launched the “Five Routes” initiative to better connect Brazil to its neighbours, allowing increased trade within the continent.

“Why now is a good question,” says Myers. “I don’t know if there’s some project that they’re trying really hard to get China to support at this particular moment. Brazil is hosting the G20; it might be that this is a moment for both countries to demonstrate a strong relationship.”

That said, there is a risk of over-interpreting the symbolism of such an announcement, she believes. “In my view, [joining the BRI] is primarily symbolic in nature, representing a degree of support for China’s global agenda and for China’s growing global role and vision.

“Sometimes, when countries join the initiative, there are agreements that are announced in tandem. But these tend to be one-time agreements,” Myers added. “It’s not as though we see an explosion of overall economic activity before or following the decision to join the BRI. We generally do not see a major shift in the overall dynamic pre- and post-BRI membership.”

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India’s milk industry struggles as the climate changes

The impacts of climate change, particularly high heat, are impacting milk production and the revenue of the small farmers dependent on it.

Chandan Singh lives in Punawali Kalan, a village in northern India’s Jhansi district. Two of the dairy farmer’s buffaloes died during the monsoon season this year after contracting haemorrhagic septicaemia (HS), which spreads in the humid conditions that climate change is exacerbating (Image: Sneha Richhariya)

In a humid, late-July day this year, Chandan Singh went to milk his buffaloes, only to find five of them spewing foamy saliva. The village veterinarian diagnosed haemorrhagic septicaemia (HS), a bacterial disease also known as gala ghotu rog. Treatment cost around INR 15,000 (USD 179), which roughly equates to six weeks of the dairy farmer’s income. Despite this intervention, two of his buffaloes died within days.

“They developed swelling in the throat and the eyes became red. They couldn’t breathe,” Singh says.

Singh, who lives in Punawali Kalan village in the north of India, is not alone in suffering such losses. Around 75 cattle have died within a five-kilometre radius of his village this monsoon. HS thrives in moist and humid conditions. This makes it a recurring challenge for farmers, particularly as climate change increases temperatures and intense rainfall events in the region.

Rajkumar Rajput, also a dairy farmer in Punawali Kalan, says his herd’s milk production plummets during heatwaves (Image: Sneha Richhariya)

This year, Punawali Kalan’s dairy farmers have also experienced plummeting milk yields due to extreme heat waves. Rajkumar Rajput, another local farmer, saw his daily production drop from 45 to 30 litres as winter became summer. Rajput supplies the daily milk demands of 40 households and says he “had to buy milk to cover the shortfall”. 

In 2017, India’s Central Institute for Research on Buffaloes conducted a study on climate change and buffalo farming. It said sudden extreme temperature variations can cause a 10-30% drop in milk production during the first lactation, and a 5-20% drop during the second and third lactations. These impacts continue for 2-5 days.

This challenge is only set to grow. A 2022 study by the Indian Grassland and Fodder Research Institute estimates that, as temperatures rise, the growing drop in annual milk production in the northern plains – which account for 30% of India’s milk production – could amount to 361,000 tonnes by 2039. Such a drop would represent losses amounting to INR 11.93 billion (USD 142 million).

A 2022 Lancet study warned that, if global greenhouse gas emissions remain high, rising temperatures could cut milk production in arid regions by 25% by 2085.

The direct and indirect threats of climate change

Abhinav Gaurav, a livestock management advisor for the climate action NGO Environmental Defense Fund, says climate change is impacting cattle both directly and indirectly. The animals themselves struggle with intensifying heat and humidity, and the climate impacts also interfere with the production of their fodder, alter their pastures, and increase their exposure to disease.

A 2016 study led by Bengaluru’s National Institute of Animal Nutrition and Physiology suggested most milk production losses were incurred via these indirect climate change impacts. Predominantly, that means shrinking – or simply unavailable – feed and water sources.

Climate change affects forage quality and availability by shifting precipitation patterns, raising temperatures, and altering vegetation. This compounds water scarcity, which is especially harmful to buffaloes because their thick black skin makes them particularly vulnerable to heat stress. “The loss of traditional wallowing ponds exacerbates this vulnerability,” adds Gaurav.

Yunus is a dairy farmer in the Bulandshahar district of Uttar Pradesh, north India. Extreme rainfall and heat cause him to face both higher fodder prices and lower milk outputs (Image: Sneha Richhariya)

Yunus, another dairy farmer in northern India, has seen fodder prices surge when crops fail in heavy rainfall. “I had to buy fodder at INR 1,700 per quintal, compared to the usual INR 700-800,” he says. This summer, milk output from Yunus’ 30 buffaloes dropped from 200 to 150 litres.

In the dairy sector, milk prices depend on fat and solid-not-fat content. This content decreases in the lean period (April to September) as heat and humidity rise. Climate change exacerbates this by making heat stress and erratic rainfall more likely, meaning less income for milk producers.

This machine at Punawali Kalan’s Balinee Milk Producer Company measures the fat and solid-not-fat content of milk. During the lean season between April and September, these contents reduce and milk fetches lower prices (Image: Sneha Richhariya)

An industry blinkered by target-chasing

Launched a decade ago, the Indian government’s National Livestock Mission aims to boost productivity and fodder production in the sector, but it fails to consider the impact of climate change.

Dialogue Earth consulted Namrata Ginoya, senior manager of the Resilience and Energy programme at the World Resources Institute India. She has studied adaptations to climate change in dairy farming, and says farmers are beginning to understand how climate variability and its impacts on rainfall, heat and moisture will affect their cropping systems. On the other hand, she notes there is still insufficient information available to farmers on how rising heat stress could affect their cattle.

“The dairy sector in north and west India now relies on cooperative societies like Amul, which depend on small farmers with few cattle,” explains Ginoya.

India’s remarkable position as the world’s largest milk producer rests on the structure of these dairy cooperatives, as well as a national programme to expand milk production that began in 1970. The majority of milk producers in such cooperatives are small farms with limited resources. “With [the impact of] climate change, many small farmers can no longer afford to keep livestock,” Ginoya adds.

“The government is not yet focusing on climatic variations,” adds Singh. “Right now, the focus is on achieving higher milk production.”

In 2021, the Department of Animal Husbandry and Dairying began to implement a national action plan for dairy development, with a goal of doubling 2016’s national milk production rates by 2024. In 2022, Uttar Pradesh published a five-year promotion policy for its milk products and dairy development. Its 11 objectives do not explicitly consider the impacts of climate change. So far, there is little public data available on how these projects have progressed.

Dairy sector emissions: A loop paradox?

Climate change negatively impacts the productive performance of meat and dairy livestock, but this is a two-way relationship: livestock farming intensifies climate change by contributing substantially to greenhouse gas emissions. Compared across a 20-year period, methane emissions (such as those created by livestock digestive processes) have 86 times the global heating potential of carbon dioxide; methane breaks down in the atmosphere after approximately 10 years, while carbon dioxide persists for 300-1,000 years.

Dialogue Earth consulted V Beena, a veterinary physiology professor at the Kerala Veterinary and Animal Sciences University: “In India, carbon emissions from livestock farming may not be as significant as in western countries, where large numbers of animals are raised for meat, leading to high methane emissions. Here, mixed farming, with livestock and plantations, helps in carbon sequestration, making many farms close to carbon-neutral.”

“There is a need for farms to undergo carbon assessments, and a licensing system could ensure that each farm maintains carbon neutrality,” Beena adds.

Tentative solutions

The Indian Council of Agricultural Research launched the National Innovations in Climate-Resilient Agriculture (NICRA) project in 2011. An attempt to mitigate climate change impacts in the agricultural sector, the project focuses on research, technology demonstrations and awareness-raising.

“NICRA has produced valuable findings, such as identifying genetic traits in indigenous cattle breeds for better productivity and resilience to weather conditions,” says Gaurav. “It has piloted studies in 151 climatically vulnerable districts with promising results, but further knowledge dissemination and policy integration is lacking.”

In the meantime, there are few ways for farmers like Chandan Singh to recoup their losses. The government’s livestock insurance scheme only covers losses attributable to death.

In response to a Right-to-Information request filed by Dialogue Earth, the Uttar Pradesh Dairy Development Board revealed that between April 2008 and March 2024, a total of 840,063 dairy animals were insured under this insurance scheme. Between April and August 2024, another 53,962 were added. During the financial year 2017-18, the highest rates of insurance occurred, when 204,296 animals became covered. During 2009-10, only 7,808 became covered.

During 2018-19, there were 19 and 33 million cattle and buffalo respectively in Uttar Pradesh, according to the government’s livestock census of 2019.

Therefore, during the past 15 years, the percentage of dairy animals insured in Uttar Pradesh has never been higher than 0.4%.

Some private firms, like DeHaat in Bihar and the Kerala Co-operative Milk Marketing Federation (known as Milma in Kerala and Kutch Milk Union in Gujarat), are piloting heat-based cattle insurance. DeHaat’s head of dairy input, Digvijay Singh, says the company registered 4,500 farmers when it rolled out its scheme this March, covering them from April to July. DeHaat ultimately paid out approximately 55 claims for that period. The company aims to expand the scheme in 2025 to cover longer time periods.

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