Perspective of Dairy Industries in
India (Indian Express)
Mains Paper 3: Economy
Prelims level: Dairy Industry
Mains level: Describe the importance of Dairy Industry
- Indian dairy sector, that includes milk production, collection,
processing, distribution and marketing, plays a seminal role in rural
economy, second only to agriculture.
Importance of Dairy Industry:
- Over 71 million of 147 million households in the country depend on dairy
for their livelihood.
- Livestock sector contributes nearly 26 per cent to rural income in case
of poorest households and about 12 per cent in case of overall rural income.
- Dairying provides a remunerative outlet for family labours. Other than
income generation and livelihood security, dairying also ensures nutritional
security for the family.
- Dairy sector is uniquely characterised more by ‘production by masses’
rather than ‘mass productivity’.
- Milk production in India stands at 176.3 million tons in 2017-18, but
due to various socio economic factors, there exists wide inter-state
variability in milk production.
- While the per capita availability of milk is 375grams per day at
all-India level, it varies between 71 grams per day in Assam to 1120 grams
per day in Punjab.
- India is world’s largest producer and consumer of milk accounting for
nearly 19 per cent of the world milk production.
- Indian dairy sector is struggling with low productivity of animals which
is estimated as 1806 kg per year, as against the world average of 2310 kg.
- But, diverse population of cattle and buffaloes offers great prospects
for increasing the mill production.
- India is blessed with a huge biodiversity of 43 indigenous cattle breeds
and 13 buffalo breeds.
- Intervention of dairy co-operatives has increased farmers’ income,
created employment opportunities, eased availability of credit to poor
farmers, led to empowerment of women, enhanced nutritional security, and
also increased flow of new technology.
- Women members of the dairy co-operative are also being encouraged to
assume leadership roles.
- Despite immense utility and impact, dairy co-operatives are facing
several constraints and challenges mainly due to state co-operative laws.
Hence, Government of India launched a central sector scheme in 2016-17 to
support state co-operative dairy federations in providing a stable market
access to farmers.
- A corpus fund of Rs 300 crore has been kept in perpetuity with National
Dairy Development Board (NDDB) to provide soft loan as working capital to
- Moving further, formation of Farmer Producer Companies in dairy sector
has mobilized farmers to enhance their capacity as producers and marketing
- In order to boost dairy processing and infrastructure, a special fund
(Dairy processing and Infrastructure Development Fund, DIDF) was created for
the period from 2017-18 to 2028-29. The project is being implemented by
National Dairy development Board and National Dairy Development Corporation.
- This fund is helping build an efficient milk procurement system by
setting up chilling infrastructure, modernization of processing
infrastructure, and adding manufacturing facilities for value added products
for the milk unions and milk producer companies.
- Beside this fund, additional cold chains and processing infrastructure
is being created under Kisan SAMPADA Yojana run by Ministry of Food
Key challenges faced by Dairy sectors in India:
- Low productivity of Indian bovines,
- Imbalanced feeding to animals,
- Limited access of milk producers to organised sector,
- Age old infrastructure operating on absolute technology,
- Lack of organised credit system
- Lack of manufacturing facilities for value added products,
- Lack of efficient chilling infrastructure at village level,
- Lack of penetration in smaller cities/towns in terms of milk marketing
- Lack of efficient cold chain distribution network.
Plans for prosperity:
- The Union Government prepared and implemented a holistic “National
Action Plan for Dairy Development for 2022” in 2018.
- National Action Plan envisions to increase milk production to 254.55
million metric ton by 2021-22 and 300 MMT by 2023-24.
- Recently, Prime Minister has launched ‘National Artificial Insemination
Program’ to cover entire country with quality Artificial Insemination (AI)
services. Various breed development interventions are being implemented
under Union Government Schemes, such as National Dairy Plan (phase 1) and
Rashtriya Gokul Mission.
- Further, a National Bovine Genomics Centre for Indigenous breeds (NBGC-IB)
is being set-up to pave way for systematic and fast paced improvement of the
precious indigenous animal resources using highly precise gene technology.
- Union Government also implemented a comprehensive National Dairy Plan
(phase-I) during 2011-12 to 2018-19. Currently, NADB has initiated talk with
the World Bank and concerned government department to launch second phase of
- The second Phase will primarily focus on developing milk processing
infrastructure and establishment of milk quality testing equipment at
critical points of procurement areas.
- Government of India launched an ambitious ‘Dairy Entrepreneurship
Development Scheme’ with the objective to promote entrepreneurship by
generating opportunities for self-employment in dairy sector. NABARD is the
At present, India’s share in global dairy trade is just one per-cent, which
needs to be enhanced by technology infusion and quality management. We need
exclusive and dedicated efforts to transform Indian dairying into a globally
competitive enterprise with welfare of farmers at the core.