Indian dairy industry has overcome numerous challenges and undergone significant transformation over the years. The journey from being a milk deficit country in 1950’s to becoming the world’s largest milk producer has been exemplary. Milk production has grown considerably at 4.7% CAGR1 since the white revolution of the 1970s, making India the world’s largest producer of milk with annual production of 198.4 million MT (2019-20) and contributing to 21% share in global milk production. The huge domestic demand for milk has absorbed most of the “white revolution driven growth” in milk production, with negligible and erratic surplus available for exports. Consequently, India contributes less than 1% to global dairy exports.
Total bovine population in India has increased by 52% from 198.7 million in 1951 to 302.3 million in 2019. This has been possible due to multiple initiatives and support provided by the Government for improving animal healthcare facilities, upgrading breeding centers and focus on feed/fodder production over the years. Owing to this huge bovine stock, India has managed to attain numero uno position in milk production. However, the full potential of Indian milch herd in terms of productivity remains unattained. To meet the growing demand for milk and milk products, it has become inevitable to focus on increasing productivity levels of cattle and buffaloes as well as to increase the ratio of productive animals in the overall bovine population. This necessitates a strong developmental focus on dairy livestock healthcare, feeding systems and breeding systems in India. Management of all these aspects will play a pivotal role to achieve higher milk production in future.
Despite the exponential growth of dairy industry, the domestic dairy sector faces various challenges across the value chain - such as poor milk quality, low yield, lack of infrastructure and fragmented production. As independent India turns 75, focus needs to continue tackling these challenges to make the dairy industry future ready. With the advent of various technologies and digitalization, it has become imperative for the dairy industry to utilize these advancements for resilient and long-term growth of the sector. Last year covid outbreak has further led to emphasis on use of technology and digitalization for tackling supply chain challenges.
Application of digital technology will play an important role in achieving high growth by enabling increase in productivity, transparency, traceability across the dairy value chain. Digitalization could be a key differentiator in future for successful dairy operations enabling the farmers as well as dairy processors
in better record keeping, traceability, quality, reduced processing losses and efficient logistics. Key digital interventions for tackling existing challenges in dairy farm management, farmer payments, supply chain monitoring, production planning and reach to end consumers need to be disseminated and adopted on a larger scale for development an efficient and future ready value chain.
Indian dairy sector is a key contributor to millions of rural households and will continue to support rural economy is coming years as well. India’s milk production is expected to grow at a CAGR of ~4% reaching an output of 289 million MT in 2029-30. This is growth is being driven by government support through various incentives and developmental schemes across the supply chain. In addition, modern technology and digitalization across the supply chain is leading to increasing milk productivity, improved farm management practices, better record keeping and enhanced technology for breed selection. The overall share of India in world milk production is expected to increase to ~26% in 2030 from existing share of 21%, retaining the position of “the largest milk producer in the world”. Outlook of Indian dairy industry in 2030 has been outlined in the paper to provide an overview of the changing landscape of the industry in terms of production, demand, productivity, and consumption.