India produces 25% of the world’s milk, yet its dairy exports remain stuck below 1% of global trade. This paradox highlights structural challenges in the country's dairy sector despite its massive output.
Milk Consumption in India
Milk holds a central place in the largely vegetarian Indian diet. According to recent data, 93% of rural households and 95% of urban households report daily milk consumption. Per capita milk availability in India reached approximately 485 grams per day in 2024-2025, significantly higher than the global average of 328 grams per day.
Why Exports Lag Behind
Despite high production, Indian dairy exports face several hurdles. These include quality standards, high production costs, and competition from established exporters like New Zealand and the European Union. Additionally, domestic demand absorbs most of the milk produced, leaving little surplus for international markets.
The Indian dairy industry is dominated by small-scale farmers, which makes it difficult to achieve the economies of scale needed for competitive pricing. Furthermore, non-tariff barriers and stringent sanitary requirements in developed markets pose additional challenges.
To boost exports, the government has initiated schemes to modernize dairy infrastructure and improve quality control. However, experts believe that significant policy reforms and investment are needed to unlock the sector's export potential.
