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Dairy industry should enhance production, processing and marketing
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Friday, 10 April, 2026, 16 : 00 PM [IST]
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Jashandeep Kaur & Dr Neha Bajwa
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The dairy farming sector is a crucial component of the rural economy in India. Milk production has become a significant source of income for rural households. Dairy products, including milk, are integral to contemporary diets. In 2024, the Indian dairy market was valued at US$135.30 billion and is expected to grow substantially, reaching US$274.09 billion by 2032 with a compound annual growth rate (CAGR) of 9.33%. India stands as the largest milk producer globally and is also a leading exporter of dairy products. The dairy industry contributes about 5% to the country’s GDP and supports over 80 million farmers directly. Key milk-producing states include Uttar Pradesh, Maharashtra, Himachal Pradesh, Madhya Pradesh, Rajasthan, Punjab, and Tamil Nadu. The government has implemented several initiatives to promote the dairy sector, such as the Rashtriya Gokul Mission, National Dairy Development Board (NDDB), State Cooperative Dairy Federations, National Programme for Dairy Development (NPDD), and Dairy Entrepreneurship Development Scheme (DEDS). These efforts aim to enhance production, improve farmer incomes, and boost the overall growth of the dairy industry in India.
Future strategies: Meeting the growing global food demand requires increased investment in dairy farming. To ensure viability for farmers, it is essential to enhance animal productivity and expand farm sizes. Additionally, there needs to be a shift in mindset, recognising dairying not just as a subsistence activity but as a sustainable and profitable profession.
Increase Milk Production: India, with the highest bovine population in the world, holds tremendous potential to strengthen its position in the global dairy market. Livestock, particularly dairying, plays a crucial role in the national economy and the socio-economic development of millions of rural households. Livestock can significantly contribute to poverty alleviation, as the demand for livestock products is projected to rise substantially in the coming years. According to one projection, India’s milk production demand is expected to more than double by 2020 (Delago et al., 1999).
Strategy and Infrastructure Development: The Indian dairy industry should enhance its dairy production, processing, and marketing infrastructure to meet international quality standards. A comprehensive strategy must be developed to ensure the production of high-quality, safe dairy products, supported by appropriate legal frameworks.
Focus on Specialty Products: India’s dairy sector is distinct due to the abundant availability of buffalo milk. Leveraging this, the industry can concentrate on producing buffalo milk-based specialty products, such as Mozzarella cheese, to cater to specific consumer demands effectively.
Production Cost Reduction: To enhance the competitiveness of the Indian dairy industry, efforts must focus on reducing production costs. This can be achieved by increasing animal productivity, improving animal healthcare and breeding facilities, and optimising the management of dairy animals. Both the government and the dairy industry will play a crucial role in driving these initiatives forward.
Nutrition Management for Increasing Productivity: In India, livestock feed resources are insufficient both in quality and quantity. Permanent pastures and grasslands cover only about 3.6 percent of the geographical area, while fodder cultivation occupies merely 4.86 percent of cultivable land. Producing quality seeds for fodder varieties is a critical priority. The feed industry plays a vital role in ensuring a steady supply of feed to intensive dairy farms. Despite an annual feed requirement exceeding 120 million metric tons (MMT), current production capacity is around 8 MMT (Khanna, 2016). There is significant potential for establishing plants to manufacture cattle feed, mineral mixtures, total mixed rations, bypass protein, and bypass fat feeds to bridge this gap.
Sexed Semen Technology: India holds a unique cultural reverence for cows, with less than 40% of its cows being productive. The cow is considered sacred, and slaughter is illegal, which, combined with high milk demand, results in male calves being largely non-productive. These male calves are often castrated early and frequently left unattended. Progressive farmers have increasingly adopted ABS sexed semen technology, which ensures over 90% female progeny. This leads to a higher number of heifers and fewer male calves, which have limited market value.
The adoption of advanced technologies such as genomic selection, sexed semen, and improved artificial insemination (AI) practices at the grassroots level can set new benchmarks in overall Indian milk productivity. These advancements will also boost individual animal productivity, helping the Indian dairy industry reach new horizons. Future development suggestions for India’s dairy sector have also been proposed by Karmakar & Banerjee (2006).
Public-Private Partnerships: With advancements in technology and the growing presence of organised retail in Indian markets, the dairy industry has successfully introduced both ethnic and exotic dairy products to consumers. Strengthening public-private partnerships (PPPs) in the Indian dairy sector could be a significant driver of growth, benefiting people at the grassroots level and contributing positively to the overall economy of India.
Employment Generation at the Rural Level: The dairy sector serves as a primary source of income for an estimated 27.6 million people (Naidu and Kondaiah, 2004), with 65 to 70% of them being small, marginal, and landless farmers. Consequently, the dairy industry is widely recognised as a pro-poor sector, where positive developments directly translate into increased income and employment opportunities for millions across India.
India’s dairy industry stands at a pivotal moment, presenting vast opportunities for growth, investment, and innovation. With rising consumer demand and advancements in technology transforming dairy farming, the sector is poised to play an increasingly vital role in the Indian economy. Supported by a strong policy framework, enhanced private sector participation, and sustained investments in modern infrastructure, India is set not only to maintain its position as the world’s largest milk producer but also to become a leading exporter of high-quality dairy products. Looking ahead, the future of India’s dairy industry is promising, with prospects for greater efficiency, sustainability, and profitability benefiting all stakeholders.
(The authors belong to University Centre of Excellence in Research, Baba Farid University of Health Sciences, Punjab. They can be reached at nehabajwa2765@gmail.com)
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