India's Dairy Industry Overview
India stands at the forefront of the global dairy industry, contributing over 24% to the world’s total milk supply. This is supported by a significant livestock base, including around 192 million dairy cattle and 135 million dairy goats, establishing India's dominance in the sector.
Milk Production and Processing
In the fiscal year 2023-2024, India achieved a remarkable milk production volume of 239.3 million tonnes. The processing sector is robust, handling between 65 to 70 million tonnes annually. Key dairy products include cheese, with a production of around 90,000 tonnes, and milk powder and whey, each contributing approximately 600,000 tonnes per year.
Key Dairy Enterprises
Prominent players in the Indian dairy market include Amul, Mother Dairy, Milky Mist, Parag Milk Foods, and Yakult Danone India. Other significant contributors are Baramati Agro Ltd., Hatsun Agro Product Ltd., Karnataka Milk Federation, Heritage Foods, and Vijay Dairy & Farm Products.
Exports and Imports
India exports about 100,000 tonnes of dairy products annually while importing around 50,000 tonnes. This balance highlights India's strategic position and self-sufficiency in dairy production.
Significant Market Events
Recent developments in the market include Milky Mist's planned IPO valued at ₹20,000 crore and Mother Dairy's goal of achieving a turnover of ₹17,000 crore by FY 2025. Parag Milk Foods reported a 27% increase in profits from ghee and cheese production, while Yakult Danone India launched 'Yakult Light Mango', targeting a 50% sales growth. India will host the World Dairy Summit in 2027, further cementing its global significance.
Future Outlook
The Indian dairy market is set for expansion, with plans for the world’s largest curd manufacturing facility in Kolkata and biogas model implementation in 250 cooperative districts. Despite geopolitical tensions, India focuses on technological modernization, value-added products, and export diversification.
Regional Contributions and Challenges
Gujarat contributes significantly with 18.31 million metric tonnes in 2024, while Karnataka is a leading producer, with the Karnataka Milk Federation collecting 1.06 crore litres in a single day. However, challenges persist, such as farmers in Punjab facing financial strain due to falling 'toori' prices and the re-emergence of Lumpy Skin Disease affecting livestock.
Trade and Policy Dynamics
India's trade strategy protects domestic farmers while negotiating tariff reductions for non-essential imports. The potential US-India trade deal could lower milk prices by 15%. India's firm stance on dairy tariffs has delayed trade agreements with Australia and others. The India-UK Free Trade Agreement is expected to boost Indian agricultural exports, with forecasts suggesting a 20% growth in the next three years.
Technological Advancements
An advanced ₹90-crore high-technology dairy processing plant in Namakkal is nearing completion, expected to benefit over 15,000 dairy farmers by ensuring faster milk procurement and timely payments. The paneer market is also evolving, with major brands like Amul and Mother Dairy driving growth towards an estimated ₹2 trillion market by 2033.
Industry Appeals
The Indian dairy sector is making a strong appeal to the GST Council to reduce GST on ghee and butter from 12% to 5%, highlighting the economic and cultural significance and the impact on market fairness, rural livelihoods, and formalization. India’s NCDC is providing a grant-in-aid to boost its dairy sector, focusing on cooperatives and technology for a prosperous future.
Strategic Investments
India’s path to becoming a ‘Developed India’ by 2047 is being powered by a massive strategic investment in its dairy sector. The Union Cabinet has approved a ₹2,000 crore (₹240 million) grant to the National Cooperative Development Corporation (NCDC) for the period of 2025-26 to 2028-29. This funding will allow NCDC to raise an additional ₹20,000 crore from the open market, which will be channeled into long-term credit and working capital for cooperatives. This decision marks a significant, sustained commitment to modernizing the dairy industry, aiming to transform it into a formidable engine of socio-economic development.
Regional Initiatives
Jammu & Kashmir's Dairy Sector Reform is driven by the ₹1,433 crore initiative to transform the region's dairy sector, while Rajasthan aims to solidify its position as India's second-largest milk producer. Kerala resists market entry from Karnataka's Nandini brand, and Odisha faces challenges with new OMFED milk products.
Modified: 2025/08/15