Why dairy is India’s most inclusive economic revolution

The modern chapter of India’s dairy journey begins not with a single scheme but with a quiet shift in rural imagination, when millions of small farmers started organising themselves in pursuit of dignity, voice and fairer economic terms. What followed through the 1970s was a national mobilisation that transformed milk from a household activity into a pathway for rural renewal. It is fitting that National Milk Day honours Dr Verghese Kurien, whose conviction placed farmers at the heart of this transformation and whose legacy continues to shape the sector even as its challenges grow more complex.

From producing barely 23 million tonnes of milk in 1970, India today produces more than 239 million tonnes (2023-24). Per capita availability has risen from 130 grams per person per day in 1950-51 to 471 grams today. These achievements reflect patient institution-building and the everyday labour of farmers who turned dairying into a stabilising force in rural life. For many households, milk income is not just a livelihood; it is liquidity, security and a steady anchor in uncertain agricultural environments.

Despite its scale, the sector is constrained by a cluster of structural weaknesses that threaten its long-term viability. Per-animal productivity remains low, making dairying economically unviable for many small farmers already burdened by rising feed costs and shrinking fodder land. Cooperative penetration is uneven, leaving millions of producers dependent on informal buyers and vulnerable to opaque pricing. India still lacks a national-level support system for small dairy farmers, strengthening the case for an MSP for milk to ensure predictable incomes in a perishable commodity economy. Quality concerns-including antibiotic residues, inconsistent veterinary oversight and the persistent challenge of Foot and Mouth Disease-undermine both domestic safety and export potential. These pressures have

already pushed many young farmers to reconsider dairying, revealing a sector in urgent need of reform if it is to retain its social and economic centrality.

At the same time, the social depth of dairy remains striking. The sector supports more than eight crore farmers and contributes close to five per cent of the national economy. Its value exceeds `11.6 lakh crore-greater than the combined output of paddy and wheat. More than 48,000 women-led cooperatives attest to the steady expansion of women’s economic participation. Milk income sustains households when crops fail, credit is scarce and employment is seasonal. Few sectors distribute opportunity as widely or as intimately as dairying.

To secure the future, India must move from volume to value, from fragmented transactions to integrated supply chains, and from dependence on raw milk sales to a diversified basket of high-value products. Investments in chilling infrastructure, scientific processing, robust cold chains and innovation in cheese, whey, nutrition products and long-shelf-life items can convert India’s milk wealth into real economic strength. Policy vision must now focus on institutional structures that protect farmers, encourage value addition and create clear pathways for small producers to climb up the value chain.

Environmental pressures sharpen the need for reform. As climate variability reshapes fodder availability and disease patterns, India will have to invest in climate-resilient breeds, sustainable feed systems and integrated biogas models. Productivity gains, ecological prudence and animal health must advance together if the sector is to remain viable.

National Milk Day is therefore not only a tribute to past achievements; it is an invitation to reimagine the future with clarity and courage. The dairy sector has grown in scale. It must now grow in fairness, sustainability and institutional depth. India carries the moral legacy of Dr Kurien and the entrepreneurial energy of millions of farmers. The foundations are strong. What remains is the collective resolve to ensure that the world’s largest milk producer becomes the world’s most inclusive and future-ready dairy powerhouse.

The writer is a public policy professional with years of experience working across key ministries of the Government of India ; views are personal