01/09/2014
Market data
INDIA is the 2nd largest in the emerging economies in the world, with a GDP growth rate of ~6.5%, 3th largest economy in the world (based on PPP) with a GDP of US $ 4.4Trillion, and according to BRIC report published by Goldman Sachs, India will be the 2 largest economy after China by the year 2035.
India, world's largest milk producer, accounting for more than 16% of world's total milk production, is the world's largest consumer of dairy products. The total amount of milk produced has tripled from 23 million tonnes back in 1973 to 95 million tonnes in 2008 and expected a production level of 135 million tonnes by 2015 but the projected demand for milk by 2021-22 estimated at 180 million tonnes which implies that milk production would have to be doubled.
Milk production is growing at 3.3% while consumption is growing at 5% leaving a gap between demand and supply. Inorder to meet the rapid growing demand and to increase the milk production, Union Govt has started a central scheme National Dairy Plan – Phase 1, for a period of 2011-12 to 2016 – 17.This scheme will be implemented with a total investment of about 2242 crore. This scheme main objective is to help provide rural milk producers with greater access to the organised milk –processing sector and thus to bridge the gap between the demand and supply of milk in the country.
The share of the total milk processing capacity by private sector is 44%of total installed capacity of 73 MLPD (Million Litres Per Day) in the country. Therefore, the total share of the organized sector, both cooperatives as well as the private sector is barely 12%. What is, therefore, disquieting is that as much as 88% share of the total milk production is commanded by the unorganized sector. Inorder to attract promote Dairy Industry and attract more investment in this sector, govt has also reduced the excise duty of 16% to Zero on Dairy processing Machineries.
The untapped potential of the dairy sector is immense and opportunity to set up a new dairy venture is great. And there is vast potential for the export of dairy products, as the cost of milk production in India being the lowest. These factors are attracting huge amount of investments in dairy processing, manufacturing dairy processing equipment, fruit packaging equipment and equipments for biotechnology related dairy industry.
