by Umaima Reshi
SRINAGAR: Dairy development in Jammu and Kashmir can be traced back to the 1950s, when the Civil Veterinary Department was renamed the Animal Husbandry Department. In subsequent decades, the dairy industry in the region experienced various milestones and phases of expansion.
Liquid semen was first used for artificial insemination (AI) at two centres in Srinagar and Jammu in 1954 to improve cattle breeds. The same year, the Hill Development Scheme introduced Jersey bulls. The establishment of the Cheshmashahi Milk Scheme in 1967 marked the beginning of milk processing in the region.
By 1977, the Intensive Cattle Development Programme had moved AI to all 100 Animal Husbandry Centres. The Indo-Danish Project in 1982 resulted in Frozen Semen Banks being established, which introduced frozen semen technology for AI at 30 centres across the Union Territory.
A major event happened in 2004 when the Government of Jammu and Kashmir signed an MoU (Memorandum of Understanding) with the Gujarat Cooperative Milk Marketing Federation (AMUL), which resulted in the formation of the Jammu and Kashmir Milk Producers Cooperative Limited (JKMPCL).
Moreover, in 2006, two Livestock Development Boards were set up under the National Project for Cattle and Buffalo Breeding (NPCBB) to further the breed improvement programme.
The year 2020 saw the launching of the Integrated Dairy Development Scheme (IDDS), which brought Rs 150 crore of investment into the dairy sector, thereby creating 13,500 dairy units and 16,000 jobs. The Holistic Agriculture Development Programme (HADP) targeted Rs 372 crore for the dairy sector in 2023, while the JKCIP programme dedicated its efforts to milk collectivisation for marginal communities in 2024.
Milk Scenario and Current Status
Right now, Jammu and Kashmir’s annual milk production is about 28.75 lakh metric tonnes with a turnover of around Rs 11,500 crore. The daily per capita availability of milk is 577 grams, which is much higher than both the national average (471 grams) and the world average (322 grams).
The Union Territory’s livestock comprises 31.45 lakh farm animals, which include 15.57 lakh adult cows and 10.9 lakh breedable cows, among others, with about 8 lakh dairy-producing families in the sector.
The average milk yield per cow is 2,584 litres for a 305-day lactation period, which is just slightly above India’s average of 2,555 litres, and still quite far from high-tech countries like Israel (12,953 litres) and the United States (10,926 litres) that have high yields.
Milk processed in the organised sector constitutes only 4 to 5 per cent of the overall milk production, and it is around 4 lakh litres daily. This figure is quite low compared to the national average of 25 per cent. JKMPCL is the largest and only cooperative in the state that processes about 2.25 lakh litres per day, linking more than 75,000 farmers. On the other hand, private dairies handle about 1.75 lakh litres daily, involving 29,000 farmers through intermediaries. In Gujarat, however, around 80 per cent of the milk produced is processed through cooperative systems.
The government has concentrated on the dairy sector’s three core areas through national and regional programmes such as NPDD, HADP, IDDS, and NAIP while also enhancing the productivity of cows, collection and cooling of milk, and processing, adding value, and marketing.
Productivity Enhancement
There may be several schemes in place, but there are still traditional issues like limited AI coverage, lack of high genetic merit bulls, no production of sexed semen, and a 41 per cent shortage of fodder, which is also one of the reasons for using non-scientific feeding practices.
To alter the scenario, the Rashtriya Gokul Mission (Nationwide AI Programme) has been set into action. HADP has 800 MAITRI centres, while RGM has 1,775 centres. Strengthening of the semen stations has been carried out at Ranbirbagh and Hakkal, where 40 AI bulls have been imported from the United States. Under IDDS, more than 60,000 dairy animals have been introduced, and the Fodder Development Project is targeting an increase in fodder area from 37,000 hectares to 59,000 hectares.
Milk Collection and Chilling
There is still a large gap in the milk collection network existing in Jammu and Kashmir. Only 75,000 out of about eight lakh dairy farmers are in the cooperative network, while 30 to 40 lakh litres per day (LLPD) of milk continue to be sold in the informal market through middlemen. This situation forces many small and rural farmers to sell their milk at lower prices, which finally leads to reduced income and financial losses.
Since 2019, under the National Programme for Dairy Development (NPDD), the Union Territory’s milk processing capacity has risen from 33,000 LPD to 2.5 lakh LPD. Furthermore, through HADP and JKCIP, a plan has been formulated to establish 500 new milk collection units and 100 value addition centres by 2027–28 to enhance milk collection and processing capacity.
Projected Growth and Future Demand
Milk production in Jammu and Kashmir is growing rapidly at a compound annual growth rate (CAGR) of 6.55 per cent, with projections indicating that by 2031–32, milk output will reach 50.74 lakh metric tonnes. By then, the population is expected to be around 1.81 crore, raising per capita milk availability to 768 grams per day, which is well above the ICMR’s recommended standard of 300 grams per day.
However, this growth brings new challenges. If processing capacity is not expanded, the region may face a milk surplus of nearly 30.93 lakh metric tonnes annually, posing storage and utilisation difficulties.
Limitations of Current Interventions
Failure to expand milk processing capacity on time could create several serious problems. Excess milk would continue to be sold in the unorganised sector, farmers’ incomes could decline, and they may face distress sales. Dependence on middlemen would increase, financial growth in dairy farming would slow down, and both milk quality and hygiene standards could deteriorate.
Currently, Jammu and Kashmir lacks a dedicated state-level scheme to strengthen dairy processing infrastructure. The JKMPCL’s target of achieving 5 LLPD processing capacity within seven years remains far below the region’s true potential.
To address these challenges, the government has launched a new and ambitious initiative, the Jammu & Kashmir Dairy Processing Infrastructure Development Scheme (JK-DPIDS). This scheme aims to increase the milk economy of Jammu and Kashmir from Rs 11,500 crore to Rs 20,296 crore over the next seven years.
Objectives
The primary goals of the scheme include developing a robust infrastructure for milk processing and marketing, particularly through farmer-owned institutions, connecting five lakh farmers with the organised dairy sector, ensuring the availability of safe, hygienic, and traceable milk, and promoting modern technology to establish systems for processing, value addition, and export-quality standards.
Scheme Implementation and Funding
The scheme will be implemented by the National Dairy Development Board (NDDB), which will act as the Nodal Agency. The NDDB will be responsible for identifying milk production zones (milk sheds), planning milk routes, and designing infrastructure according to the specific requirements of different districts.
The Animal Husbandry Department (AHD) will manage land allocation, inter-departmental coordination, and execution. The National Bank for Agriculture and Rural Development (NABARD) will serve as the Principal Financing Institution, providing loans, releasing funds, and monitoring financial compliance across the project.
Financial Framework
The total cost of the Jammu and Kashmir Dairy Processing Infrastructure Development Scheme for 2025–26 to 2031–32 has been estimated at Rs 1,434 crore. Of this amount, Rs 1,083 crore will be sourced through NABARD loans, while Rs 350 crore will be contributed by the End Implementing Agency (EIA).
The financial model follows a 75:25 cost-sharing ratio, meaning that 75 per cent of the funding will come from the government and 25 per cent from the EIA. Of the government’s share, 90 per cent will be through NABARD loans, and the remaining 10 per cent will be drawn from the UT Capex (Union Territory fund).
This structure is designed to make the scheme financially sustainable and accountable in the long run, ensuring that annual funds are released on time and that their impact is visible on the ground.
Project Components and Phases
The scheme focuses on two major projects — the establishment of milk processing and value addition plants, and the strengthening of milk collection and chilling infrastructure.
Ten automated milk processing plants will be set up across 18 districts of Jammu and Kashmir (excluding Srinagar and Jammu) to ensure balanced geographical distribution. Each plant will have an initial processing capacity of 50,000 litres per day, expandable to one lakh litres per day.
These plants will include facilities for value addition and packaging, effluent treatment, and marketing and transport, ensuring that processed milk and its products reach markets efficiently. The total cost for this component is estimated at Rs 1,100 crore.
The second component of the scheme aims to strengthen milk collection and chilling systems. Through village-level cooperatives and SHG clusters, around four lakh milk pourers will be linked with the organised sector. The plan includes setting up 100 Bulk Milk Coolers (BMCs) with a total capacity of ten lakh litres per day and establishing 100 milk testing laboratories to ensure quality assurance.
Milk processing units will be equipped to obtain ISO, HACCP, and FSSAI certifications, while extensive training and capacity-building programmes will professionalise farmers, cooperatives, and SHG groups. The total estimated cost for this project is Rs 300.5 crore.
Governance and Monitoring
To ensure effective oversight, a UT-Level Project Implementation and Monitoring Committee has been formed, chaired by the Chief Secretary of Jammu and Kashmir. Members include representatives from NABARD, NDDB, JKMPCL, and Secretaries from the Departments of Agriculture, Finance, Rural Development, Revenue, and Industries.
The committee will approve project plans, allocate funds, monitor their utilisation, maintain coordination between departments, and ensure transparency and timely implementation. This governance structure ensures that the scheme achieves tangible results beyond policy documents.
Projected Outcomes and Impact
By 2031–32, the scheme is expected to bring a transformative change to Jammu and Kashmir’s dairy sector. The share of organised milk processing is projected to rise from 4 per cent to 20 per cent, and the organised sector will process 15 lakh litres of milk per day.
The annual turnover of dairy cooperatives will increase from Rs 407 crore to Rs 2,956 crore, with five lakh farmers integrated into the formal dairy network. Around 10,000 new farmer collectives will be established, creating employment opportunities in 30,000 villages and 2,000 skilled jobs in automated plants.
Most importantly, safe, traceable, and export-quality milk will reach consumers. By 2031, per capita milk availability is expected to rise from 577 grams to 768 grams per day, and the overall dairy economy of the Union Territory will exceed Rs 20,000 crore.
This means Jammu and Kashmir will evolve from being a self-sufficient region to becoming a new powerhouse for export-quality milk and dairy products.
The Jammu & Kashmir Dairy Processing Infrastructure Development Scheme (JK-DPIDS) represents a truly transformative step that ushers the Union Territory’s dairy sector into a new era. By integrating small farmers, women self-help groups, and cooperatives with the processing value chain, the scheme is set to improve milk prices, quality, and market access.
More than just an economic initiative, this programme serves as a new model of rural transformation — one that propels Jammu and Kashmir beyond self-sufficiency towards export excellence and inclusive growth.
