India is the largest producer of milk globally employing 18 million people. Milk Production and marketing is still traditional and 60 percent of milk is transacted through unorganized sectors. The study aims to understand the pattern of marketing of milk and its derived products, estimate the employment generated, and exploring and assessing the potential of dairy development in the country. The study is based upon primary data collected from sampled villages of an underprivileged district of Uttar Pradesh, the largest milk producer state of the country. A steep rise in dairy farming since the last decade is found due to increase demand and improved remunerations and marketing opportunities. The allied activities are providing entrepreneurial opportunities to farmers, laborers, and women on large scale. This gives enhanced household income promoting self-reliance and better economic conditions. This model of dairy farming can be applied in the whole country to ensure better livelihoods for the poor in India.


Key words:

Dairy Farming, Employment, Livelihood, Livestock, Sustainable Development  


Dairy farming is one of the important agricultural systems of the world. Most of the developed countries of Europe, Australia, North America, South America, and some from Asia practiced dairy farming as a commercial business on a very extensive scale. Most of the extensive grassland especially in temperate regimes rears cow for milk and beef separately. They are designated as milch and beef cattle. One-third of the geographical area and 1/4th of the world’s population; mainly, small and marginal farmers have been endorsed for livestock husbandry and production of dairy and its derived products (Rangnekar D.V. 2006; Rama; Taneja V.K. 2008 & Khan N. & Parashari A.K. 2019). There are 125.34 million (2019) heads of dairy animals, including cows and buffalo in India. A large number of workers are associated directly with some processing activities as the production of dry milk powder, paneer, cheese, butter, sweets, tea stalls, transportation, and distribution.

Dairy farming has been practiced in India as an auxiliary activity to cropping system in the form of subsistence nature at a large scale. Some big companies managed by either private or cooperative societies, though in less number operate exclusive dairy farming system. Of the total milk production in India, about 48 percent milk is either consumed at the producer level or sold to non-producers in the rural area. The balance 52 percent of the milk is marketable surplus available for sale to consumers in urban areas. Out of marketable surplus it is estimated that about 40 percent of the milk sold is handled by the organized sector (i.e. 20 percent each by Cooperative & Private Dairies) and the remaining 60 percent by the unorganized sector. 80 percent production, processing and distribution are performed by individual farmers in much unorganized way which includes door to door delivery, small market channel i.e. farmers- village traders and consumer (National Action Plan for Dairy Development-Vision 2022, 2018). About 16.6 million farmers have been brought under the ambit of about 1, 85,903 village level Dairy Cooperatite Societies (DCS) up to March 2018. (National Dairy Development Board, 2019) Despite the slump in world market and better procurement prices by dairy cooperatives along with decrease in procurement volume by major private players led to increase in milk collection by the dairy cooperatives by about 11 percent. The dairy cooperatives have procured daily average of milk about 475.6 lakh kg per day during 2017-18. Traditional contract dairy farming, in which the big players like sweet makers, milk traders in urban areas and milk processing units mortgage the farmers in different villages and provide them capital for purchasing animals and the price of milk is fixed, usually lower than open market price, at the time of final agreement of contact. India is the largest producer of milk since 1998 and production reached from 75.40 million tonnes in 1998to 187 million tonnes in 2019. The country has also improved per capita availability of milk from 210 grams / day in 1998-99 to 394 gram/day in 2018-19. It shared 26 percent to agriculture GDP of the country and employ millions of marginal and small farmers in different ways. It is a largest crop in term of money value which is more than total revenue earned from combined wheat and rice production in the country. Milk and milk products contributed more than 20.60 percent of the combined output of paddy, wheat and pulses in 2017(Parida, Y & Yadav D. 2020) Dairying has become an important secondary source of income for millions of rural families and has assumed the most important role in providing employment and income generating opportunities particularly for marginal and women farmers (Ramphal O. 2016; Khan, N 2018). Most of the milk is produced by animals reared by small, marginal farmers and landless labours. Twenty-five percent of Indian farmers, mainly marginal with less than half hectares of land are involved in dairy farming in the country recently. The farmers are attached with cooperative societies for sale of their saleable milk. 16.60 million Farmers have been brought under registration of 185903 dairy cooperative society (DCS). As on 31.03.2018, the total number of women in dairy cooperatives across the country was 4.9 million including 32,092 women DCS which is 29.5 percent of total farmers (Animal Husbandry Statistics 2019) 

The dairy development in term of milk production witnessed regional variation in response to geographical size, population, nature and stages of agricultural development and degree of demand for livestock derived products i.e. milk and meat as well as government policies and incentives to the farmers. The states like Uttar Pradesh (30.50 million tonnes), Rajasthan (23.63 million tonnes), Madhya Pradesh (15.91 million tonnes), Andhra Pradesh (15.04 million tonnes), Gujarat (14.49 million) and Punjab (12,60 million tonnes) are 5 top most milk producing states in India during 2018-19 financial year. The urban surrounding or peri urban has rather higher concentration for milk production as compared to interior village location, on account of a bumper demand for liquid milk and dairy derived products in fast growing urbanization and urban population (Khan N. & Iqubal M.A. 2008; Khan N. et al. 2012). Localization of dairy processing units of large scale in this areas are also another acting player of occurrence of hot spot of dairy farming and production in urban area. Such urban oriented concentration of dairy production witnessed a historical fact that the first dairy or cattle colony was established in Allahabad during preindependence period for milk supply to army (Agriculture Skill Council of India 2016). Dairy processing plants were established in urban centres like Calcutta, Madras (Chennai), Mumbai rather than in milk shed or milk producing rural areas even after independence which discouraged rural dairy system development. This trend of development of urban oriented dairy farming has been observed to deviate towards far villages due to increasing urban land price, pollution issues (Khan N. and Salman M.S. 2014). Fodder crisis and development of fast urban rural transport linkage and fast and refrigerated transport means enabled the milk producers to sell their milk surplus in town and cities. Scaling up of this sector of livestock farming from subsistence to commercial and industrial nature resulted in socio economic and political dynamics in dairy farming structure in the country. Private capital investment in dairy sector from national and multinational companies tends to increase in the country but again nearby metropolitan cities like Delhi, Bengaluru, Mumbai, Chandigarh and Calcutta. Being a potential sector for generation of employment especially in rural areas as well as to enhance the farmers’ income in addition to earned from cropping system, government of India looked it one of important innovative tool for doubling the farmers’ income and remove the poverty from rural areas (Singh R.S. & Shukla N. S 2017; Khan, N. 2014; Khan N. & Iqbal M.A. 2009).

The growth and development of dairy in India took place in a sequential efforts of the government in both during pre and post-independence period. History of dairy development in India can be divided into two distinct phases: pre- and post-Operation Flood. The Defence Department under the British rule had established military dairy farms to ensure the supply of milk and butter to the colonial army. The first of these farms was set up in Allahabad in 1913, followed by Bangalore, Ooty and Karnal. These farms were well maintained and used improved milch animals. The onset of the Second World War gave momentum to private dairies with some modernized processing facilities. In the metros of the then Bombay, Calcutta, Madras and Delhi, and some large towns, processed milk, table butter and ice-cream were available, though on a limited scale (Kurein V. 2000; Mathur B.N. 2000; Kumar S.S. 2012).

The dairy farming sector drawn the special attention of the planners since the independence and it achieved success and amelioration and breakthrough during different plan periods adopted by country. Operation flood I, II & III had been important dairy development strategies, run with international collaboration aided by World Bank. The Cooperative movement/ societies after establishment of National Dairy Development Board (NDDB) in 1965, under the effort of Dr. Berghese Kurien, the father of White Revolution, played a pivotal role in development of white revolution through linking rural dairy farmers with dairy processing units situated in urban areas. Therefore, in 1970 the government established a public-sector company, the Indian Dairy Corporation (IDC). The IDC was given responsibility for receiving the project’s donated commodities, testing their quality, their storage and transfer to user dairies as well as receiving the dairies’ payments. Thus the financial and promotional aspects were the responsibility of the IDC while the entire technical support for OFP was provided by NDDB. A large number of innovative schemes were introduced time to time by respective central and state governments for successive improvement in this sector of economy. Government of India is making efforts for strengthening infrastructure for production of quality milk, procurement, processing and marketing of milk and milk products through different Dairy Development Schemes. Some of them are as National Programme for Dairy Development (NPDD); National Dairy Plan (Phase-I); Dairy Entrepreneurship Development Scheme(DEDS); Support to Dairy Cooperatives and Dairy Processing and Infrastructure Development Fund (DIDF), National plan for Dairy Development, Vision 2022, are very much optimistic for dairy development and improvement of socioeconomic and health condition of dairy farmers. Ministry of Agriculture and Farmers’ Welfare, Govt. of India, targeted to enhance the milk production to 300 million tonnes, marketable surplus to 180 million tonnes and milk bovine number to 116 million head during 2023-24 (Vision 2022-National Action Plan for Dairy Development 2018). The new agricultural trade policy enacted in June 2020, which tends to remove movement restriction and policy hindrance of old PMMC Act and enable farmers to sell their product anywhere in the country openly and private traders will be playing a crucial role in transaction of their marketable surplus at per-harvest price agreement through contract system. It will be also an encouraging effort to develop dairy farming in remote rural areas, generally, neglected in this sector due to inaccessibility to markets. Moreover, the country would emerge a top most country in dairy production and trade in future. Indian dairy market is expected to reach a value of Rs.18, 599 billion by 2023 exhibiting a CGAR of 12percent during 2018-23 (Bhatnagar J. 2018). The latest proposal of Govt. of India to encourage and promote private capital investment in establishing dairy and meat processing units ae well as feed grain production units in rural areas with a view to promote livestock husbandry and dairy farming in remote rural areas, would be an encouraging effort to multiply the incomes of the farmers in the country (Tekam D. et al. 2019).

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By :

Nizamuddin Khan1 , Ashish Kumar Parashari 2 and Mohd. Sadiq Salman3 1Professor Department of Geography, Aligarh Muslim University, Aligarh, India. Email: 2 Research Assistant, Department of Geography, Aligarh Muslim University, Aligarh, India Email: 3Guest Faculty, Department of Geography, Jamia Millia Islamia, New Delhi, India Corresponding author Email: 


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