THE GIST of Editorial for UPSC Exams : 17 February 2020 (Perspective of Dairy Industries in India (Indian Express))

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’.

The Scenario:

  • 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.

Steps Taken:

  • 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 dairy federations.
  • Moving further, formation of Farmer Producer Companies in dairy sector has mobilized farmers to enhance their capacity as producers and marketing professionals.
  • 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 Processing Industries.

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 and
  • 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 Plan.
  • 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 nodal agency.

Way Forward:

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.

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Prelims Questions:

Q.1) With reference to the Agricultural and Processed Food Products Export Development Authority (APEDA), consider the following statements:
1. It is an organization under Ministry of Commerce & Industry, Government of India.
2. It was established under the Agricultural and Processed Food Products Export Development Authority Act passed by the Parliament in 1985.

Which of the statements given above are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) None of the above

Ans: C
Mains Questions:
Q.1) Enumerate the importance of dairy industry in India. Also highlights the challenges faced by Dairy sectors in India.