More than 50% of India's milk business handled by the unorganised sector, says Economic Survey

PUNE: Though India maintains its position as word's top milk producer, with production of 176.3 million tonne milk production in 2017-18, more than 50% of the marketable surplus is still handled by the unoranised sector, the 2018-19 Economic Survey highlighted.

The survey reads: " Of the total milk produced in rural areas around 52 per cent is the marketable surplus. Of this surplus less than half of the milk sold is handled by the organized sector comprising of dairy cooperatives and private dairy companies and the rest by the unorganized sector."

India ranks first in milk production, accounting for 20 per cent of world production. Milk production in India has been increasing steadily over the years from 55.6 million tonnes in 1991-92 to 176.3 million tonnes in 2017-18, at an average annual growth rate of 4.5 percent.


But there exists wide inter-state variability in milk production. The per capita availability of milk is determined by the production of milk in the State. While the All India per capita availability of milk is 375 grams per day, it varies between 71 grams per day in Assam to 1120 grams per day in Punjab.

The survey noted that despite rising milk production, domestic milk prices have been fluctuating. An analysis of the data on production of milk and its wholesale price index shows that though production of milk has been rising at an increasing rate, the change in its price shows a fluctuating trend. After rising 9 per cent in 2014-15, it increased only by 2.91 per cent in 2016-17. There are three key drivers of increasing milk demand viz; (i) population growth (ii) urbanization and (iii) income growth which leads to an increase in the price of milk.