The dairy industry plays an important role in the socio-economic development of India. The dairy industry in India is instrumental in providing cheap nutritional food to the vast population of India and also generates huge employment opportunities for people in rural places.
The Department of Animal Husbandry, Dairying, and Fisheries, which falls under the central Ministry of Agriculture, is responsible for all the matters relating to dairy development in the country. This department provides advice to the state governments and Union Territories in formulating programmes and policies for dairy development. It also looks after all the matters relating to production and preservation of livestock farms (cattle and sheep). To keep focus on the dairy industry a premier institution known as the National Dairy Development Board was established. This institution is a statutory body that was established in 1987. The main aim to set up the board was to accelerate the pace of dairy development in the country and attract new investments.
India is a wonderland for investors looking for investment opportunities in the dairy industry. The dairy industry holds great potential for investment in India and promises high returns to the investors.
1. There is a basic raw material need for the dairy industry; that is, milk is available in abundance.
2. India has a plentiful supply of technically skilled laborers.
3. There is an easy availability of technological infrastructure.
4. India has all the key elements required for a free market system.
There are different sectors within the dairy industry that promise great business investment opportunities:
• Biotechnology:
1. The Indian cattle yield less milk as compared to their foreign counterparts. The Indian cattle breeders are on the lookout for ways to improve their milk yield through cross-breeding. Thus, there is a huge potential available for foreign investors to invest in dairy cattle breeding of high-quality buffaloes with hybrid cows.
2. There is also great scope for investment in different dairy cultures, including dairy biologics, enzymes, probiotics, and other coloring materials for food processing.
3. Producing biopreservative ingredients based on dairy fermentation, such as pediococcin, aciophilin, bulgarican, and Nisin contained in dairy powder, also promise great investment opportunity.
• Dairy/Food Processing Equipment:
Great potential lies for foreign investment for manufacturing and marketing of cost-effective, top-quality food processing machinery.
• Food Packaging Instruments:
There is a tremendous investment opportunity for foreign investors in the manufacturing of both machinery and packaging materials that aid the development of brand loyalty and gives a clear edge in the marketing of dairy products.
• Retailing:
Retailing of dairy products also promises great investment opportunities for standardization and upgrading dairy products in the main metropolitan cities.
• Manufacture of Ingredients:
Several ingredients are involved in the making of different dairy products like ghee, condensed milk, and cheese. Manufacturing of ingredients for these products offers a great potential for foreign investment in India.
• Finished Products:
There is a great scope for investment in the manufacturing of finished dairy products such as cheese sauce and cheese powders.
• Technically Advanced Manufacturing Units:
There is a great opportunity for foreign investors to invest in establishing manufacturing units for dairy products. The investors can build world-class manufacturing units and let them for hire. Building manufacturing units supports specialized dairy-related activities, such as cheese slicing, cheese packaging, butter printing, and dicing lines, which hold greater potential over other activities.
Thus, the dairy industry in India has huge investment opportunities in a variety of sectors. The investors are all set to gain profitable returns on their investment.
India is one of the fastest emerging economies today. With the government encouraging foreign Investments of India, it has become easier for foreign companies to foray into the Indian markets. |
Potential for investment in the dairy industry
Some areas of Indian dairy industry can be toned up by the evocation of differentiated technologies and equipment from overseas. These include:
India's Milk Product Mix
Overview of the Indian Dairy Sector
- Raw milk handling: The raw milk handling needs to be elevated in terms of physicochemical and microbiological properties of the milk in a combined manner. The use of clarification and bactofugation in raw milk processing can aid better the quality of the milk products.
- Milk processing: Better operational ratios are required to amend the yields and abridge wastage, lessen fat/protein losses during processing, control production costs, save energy and broaden shelf life. The adoption of GMP (Good Manufacturing Practices) and HACCP (Hazard Analysis Critical Control Points) would help produce milk products adapting to the international standards.
- Packaging: Another area that can be improved is the range of packing machines for the manufacture of butter, cheese and alike. Better packaging can assist in retaining the nutritive value of products packed and thus broaden the shelf life. A cold chain distribution system is required for proper storage and transfer of dairy products.
- Value-added products: There's vast scope for value-added products like desserts, puddings, custards, sauces, mousse, stirred yoghurt, nectars and sherbets to capture the dairy market in India.
India's Milk Product Mix
| Fluid Milk | 46.0% |
| Ghee | 27.5% |
| Butter | 6.5% |
| Curd | 7.0% |
| Khoa (Partially Dehydrated Condensed Milk) | 6.5% |
| Milk Powders, including IMF | 3.5% |
| Paneer & Chhana (Cottage Cheese) | 2.0% |
| Others, including Cream, Ice Cream | 1.0% |
Overview of the Indian Dairy Sector
- The country is the largest milk producer all over the world, around 100 million MT
- Value of output amounted to Rs. 1179 billion (in 2004-05) (Approximately equals combined output of paddy and wheat!!)
- 1/5thof the world bovine population
- Milch animals (45% indigenous cattle, 55 % buffaloes, and 10% cross bred cows)
- Immensely low productivity, around 1000 kg/year (world average 2038 kg/year)
- Large no. of unproductive animals, low genetic potency, poor nutrition and lack of services are the main factors for the low productivity
- There are different regions – developed, average, below average (eastern states of Orissa, Bihar and NE region) in the dairy industry.
Thanks for sharing.
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