Collective Action in Indian Dairy Industry: A Unique Model

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Case Details:

Case Code : BSTR395
Case Length : 19 Pages
Period : 2000-2011
Pub Date : 2011
Teaching Note :Not Available
Organization : National Dairy Development Board
Industry : Agri-business; Dairy
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Background Note

During the 1940s, the dairy sector in India was traditional and dominated by small and marginal farmers and landless households who relied primarily on family labor to collect and deliver milk to consumers. They possessed low yielding animals fed largely on crop residues and common grazing lands. As they lacked access to markets, the farmers were exploited by local middlemen. While the farmers were compelled to reduce prices during seasons of abundant milk supply, they were unable to meet the market demand during the off season...

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The Collective Action Model

The Operation Flood model organized rural dairy farmers into cooperatives and helped them produce more milk through technological advances. The cooperatives offered farmers an assured market price for their produce besides offering inputs such as better fodder, breed improvement through artificial insemination, and disease control measures. The model replaced the ad hoc milk production system with an organized, continuous dairy-supply chain covering all aspects right from production to consumption...


The Operation Flood model brought about a revolution in the dairy sector and transformed India from a milk deprived country to a self-sufficient one. The model successfully boosted milk production in rural areas and established a linkage between the rural producers and urban consumers through dairy cooperatives. By introducing production enhancing technologies, establishing effective and efficient supply chains, and orienting producers toward markets, the model helped in increasing the productivity of the dairy industry...

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