India’s Dairy Industry Set to Reach $376Bln by 2027, National Dairy Development Board Chief Says

India is the world's largest milk producer, with the highest population of cows and buffaloes.

The national dairy industry has witnessed robust growth since independence in 1947. However, dairy farmers and cattle farms still face a lot of challenges.

In an interview with Sputnik, Chairman of the National Dairy Development Board (NDDB) Meenesh Shah speaks about what opportunities the World Dairy Summit (WDS) presents to dairy industry stakeholders, and the industry's challenges and possible solutions.

Shah: All the member countries have to approach the International Dairy Federation (IDF) to organize the summit. We had [talks with the] IDF three years ago [about India's wish] to host the WDS and we are happy that we are hosting it [now].

I can’t comment on why it took so long, but I think it is important for a country [...] to be a host of such a kind of summit and it will be really great if we conclude it in a better way.

The federal government [has also highlighted] the importance of the summit, as Prime Minister Narendra Modi declared it open and Minister of Fisheries, Animal Husbandry and Dairying Parshottam Rupala also attended [the event] on the first day. Every day some or other of the federal ministers visits the summit and shares their knowledge.

The importance of the summit can be seen by the fact that it has attracted delegates from around 50 countries. The large number of participants is also because last summit was due to be held in 2019 in Turkey but because of [the coronavirus] pandemic there was no opportunity to hold any summit [offline]. So, everyone wanted to interact in [real-time] mode. Foreign delegates have not only come here but a lot of them are joining us virtually too.

Shah: Definitely. That is the main purpose of hosting the summit. A lot of foreign delegates are sharing their experience, knowledge and some of the best practices adopted by developed dairy nations. So, when those Indian technocrats and stakeholders of the dairy industry,who are taking part in the summit, listen to them they will learn a lot.

From here on, they will help the farmers to adopt some of those best practices so that Indian dairy can take a further leap.

Shah: India’s dairy business has already reached INR 13 trillion ($163Bln) market size and we have been growing at a 6 percent pace over the past 6 to 7 years. [Given] the kind of initiatives and schemes launched by the federal [government] as well as state governments, I don’t see that there will be any downfall in milk production in the coming 10 years.

Apart from this, the organized players in the dairy industry are gaining more share out of the total milk available in the market. So, if milk production is increasing then the business will eventually increase.

All these factors combined with the increased revenue from value-added products will boost the industry. I am saying this because initially, when the organized players started operating, their focus was limited to liquid milk. Now the focus is shifting to value-added products and even traditional products such as curd and paneer [cottage cheese] are being sold in a hygienic and packaged form which no one ever thought of.

Therefore, I believe that higher revenue generation from value addition that has happened along with sustained growth in milk production will definitely help us to achieve the INR 30 trillion mark in the next five years.

Shah: Lumpy skin disease (LSD) is a viral disease and it is a [new] disease [to our country]. Last year, we witnessed some sporadic instances of LSD. We immediately treated the [infected] animals with antibiotics and other medicines available while revaccinating other animals in the vicinity with the goat pox vaccine, which is already available in India.

Even the federal government has said that the goat pox vaccine is effective against LSD.

This year, [cases] of LSD spread from Gujarat and the NDDB worked with milk unions in Gujarat such as the Banaskantha milk union and the Sabarkantha milk union. We helped them to procure the vaccine and even gave some vaccines to farmers free of charge.

We carried out similar exercises in and around villages where cases of LSD were reported. We vaccinated all other animals who were not infected to prevent the spread.

Now, Gujarat is free of LSD but it has spread in states such as Rajasthan and others. So, we are adopting same strategy in other states as we adopted in Gujarat to prevent the spread.

Shah: A lot of vaccination programs are already going on - such as for foot-and-mouth disease (FMD) and brucellosis. The NDDB has developed Pashu Aadhar, a data base of animals, in which 220Mln animals out of 300Mln are already registered.

All information such as animal breeding, artificial insemination or activities related to vaccination are recorded. I hope with the revaccination program across the country and with better surveillance, the mortality rate will fall.

Shah: We are aware of it - basically when dairy development activities in the country started, India moved from being a country in deficit to a self-sufficient country.

Now, in terms of productivity enhancement we have already started structured productivity improvement measures - for instance we have been doing progeny testing and selection programs which take care of the genetic improvement of the animals over a period of time. So we will see increase in productivity from generation to generation.

These programs were initiated in 2000 and we have been implementing them for the past 22 years. They continued under the National Dairy Plan and the focus was to improve the productivity of animals, bringing good quality bulls to the insemination stations. So, all the animals which are artificially inseminated get sperm of a superior genetic strain.

Similarly, we are identifying female calves that have high genetic potential and we are trying to see that they improve genetically. If you see the data of past five to six years, the production of indigenous cows and buffaloes has increased.

However, it is a genetic process which takes time and we can’t expect the results in a year or two. The NDDB and federal government are working together to ensure productivity increases.

Apart from this, I would like to mention that the denominator plays a very important role when you work out average productivity. Milk production is divided by the total animals in the country irrespective of the fact that they are milch animals or dry animals.

In India, we have a culture of not killing cows because we consider them sacred. So, when we calculate the productivity we even count those cows which don’t give milk.

However, in many developed countries if a cow gives less than 9,000 liters of milk per annum they are sent to the slaughter house. They treat them solely as a business entity.

Shah: I don’t think that the costs of milk handling and marketing in India are high. India is one country which is giving more than 70 percent of money received from the consumer to the producer. Nowhere in the world is such a high percentage of consumer money going back to the producer.

Generally, milk cooperatives in India own all three critical aspects – milk procurement, processing and marketing – and the cost involved is only 25 percent, the rest goes back to the producers, whereas in foreign countries, the cost is divided.

So, our operations are the most efficient operations in the world and this is what we are showcasing in the summit: how to maximize the return to the producer so that dairying remains profitable and sustainable for dairy farmers.

Shah: I don’t agree that Indian dairies and farms are unhygienic. Our quality of dairy products or milk is as good as any product which is available in any part of the world. We have a complete village level infrastructure to see that as soon as milk is processed it is chilled.

There is a challenge in the regulated sector but it takes time to convert the unregulated sector into a regulated one because the unregulated sector provides livelihoods to a lot of people and you can’t displace them at one go.

(The unregulated sector in India's dairy industry comprises milkmen who sell milk directly to households and sweet shops in urban as well as rural areas, whereas in the regulated sector, milk is processed using modern infrastructure and marketed through official channels under certified own brands - Ed).

So, it is a structured process, which every developed country has gone through, and we are also following this process.

Sputnik: India is also facing a lack of cross-breeds and high-yielding dairy cows in some parts of the country. So, what is the NDDB doing regarding this issue?

Shah: When you [introduce] exotic breeds such as Holstein Friesians (HF) or Jerseys, you also bring certain diseases with them. Apart from this, our own breeds like Gir, Kankrej, Tharparkar, Rathi, etc, are much more adaptable to the [country's] conditions than are foreign breeds.

India is a tropical country where temperature can reach 45 to 49 degrees Celsius, and under these conditions exotic breeds will [simply] not survive.

So, it is important that our cross-breeding program is limited because if you [have] pure HF breed, you have to keep it somewhere it is very cold.

We are supervising the cross-breeding program to make sure that no more than 50 percent exotic blood is going for a cross-breed. So, we don’t want to increase the blood level of pure exotic breeds over a period of generation even after four of five times of cross-breeding.

We are also trying to promote indigenous breeds and improve their productivity so that if cross-breed animal gives 15 to 20 liters of milk every day, why can’t our Gir or Kankrej also give [the same amount]?

A number of countries such as Brazil have taken Gir germplasm from India [and] initiated the measures to boost productivity, and Gir is giving almost 20 liters of milk in Brazil. So, we are now studying different practices and trying to increase the productivity of indigenous breeds.