As we celebrate World Milk Day on June 1, it’s time to reflect on how India has scripted a significant dairy sector turnaround that has transformed the country from a milk-deficient nation immediately after independence into the world’s largest producer of milk today. Having achieved this, it now needs to tap new-age technology to unleash another white revolution and keep pace with surging demand.

India produced as much as 239 million tonnes of milk in 2023-24, more than the country’s existing needs.

The sector’s growth is hindered by its fragmented nature, with 60 per cent of milk production coming from small-scale farmers who use traditional methods that yield lower results. Improving yields can optimise supply chain costs and enhance the efficiency of the backend value chain.

Technology addresses productivity, supply chain gaps, and food safety in the dairy sector. With India’s economic growth, consumers are opting for value-added dairy products, increasing demand. Modern technology effectively supports this entire value chain.

Addressing animal care enabled by technology

India’s milk yield per animal is low, averaging 4.9 kg per day compared to the global average of 7.2 kg. Poor animal nutrition and health are major factors in this low productivity.

However, technology-enabled practices such as precision feeding can assist in addressing this challenge. Precision feeding utilises Internet of Things (IoT) sensors and analytics technology to help farmers ascertain the precise nutritional needs of their animals and adjust feed rations accordingly.

Monitoring systems allow farmers to track animals’ vital signs, like body temperature and heart rate. These systems send alerts for early medical intervention, improving animal health and increasing milk yields by 20-25 percent.

Harnessing the power of automation

Farmers, especially in urban areas with high labour costs and smaller landholdings, are adopting automated milking systems. These systems reduce human intervention, cutting costs and improving hygiene while boosting milk production by 10-15 per cent. Automation is also used for feed delivery, reducing waste and further controlling costs.

On the supply chain front, robotic palletisers and automated labelling systems are helping reduce milk waste.

Up to 30 per cent of milk is lost due to spoilage from inadequate refrigeration. Automation improves packaging, ensuring compliance with food standards. Cooperatives that have adopted such systems have reported a 15 per cent reduction in milk waste.

Embracing digital engagement

Beyond on-farm sensors and automated parlours, the dairy value chain is now coming to life in consumers’ pockets. QR-code traceability lets shoppers scan cartons or ear-tags and instantly access farm-to-fork data—right down to feed composition and vaccination records—building trust and driving informed purchase decisions. With 63 per cent of consumers willing to pay more for clean-label food products, producers are incentivised to maintain high standards, thus enabling farms and cooperatives to achieve an uplift in customer acquisition. 

Simultaneously, mobile-app platforms and subscription-based delivery services have altered buying habits: competitive pricing, one-tap reordering, and contactless doorstep deliveries ensure fresh milk arrives on time. These technologies streamline operations and influence consumer behavior by encouraging brands that offer transparency, convenience, and real-time quality alerts. By integrating digital engagement at every touchpoint, India’s dairy industry is fostering a more informed, confident, and loyal consumer base in an increasingly digital marketplace.

Challenges persist

Technology can address many issues in the dairy sector. However, challenges like lack of capital and skills among rural farmers hinder its adoption.

The high upfront cost of acquiring technology is often unaffordable for small farmers. Consequently, they may lag behind larger corporations that have the financial means and resources to invest in such technology, potentially leading to a digital divide.

There is also a shortage of skilled labour. Automation and IoT technology require personnel trained to operate and interpret data. Hiring trained staff or upskilling existing ones can be expensive and hinder technology adoption.

All stakeholders in the value chain can collaborate to ensure that technology adoption is equitable and aligned with practical realities.

Lastly, there’s the cybersecurity risk, which digital technology carries in any of its applications.

Fostering collaboration

These challenges can only be addressed through collaboration among all stakeholders, including the government, the private sector, and dairy cooperatives. Enhancing access to credit and financing for small farmers is pivotal in fostering the adoption of technology. Implementing training and skill development programs to enable farmers to fully utilise technological interventions is equally important.

On the supply chain front, a concerted effort is required to enhance rural infrastructure, develop logistics networks, and establish a robust end-to-end cold chain.

Furthermore, the implementation of blockchain-based systems can streamline milk procurement, introduce an unprecedented level of transparency to the payments process, and establish end-to-end traceability from udder to shelf, thereby enhancing consumer trust.

This World Milk Day serves as a significant occasion to reaffirm our commitment to technological innovation in dairy farming, ensuring that India remains at the forefront of global milk production for generations to come.

The author is CEO of Godrej Jersey

Published on June 1, 2025