Indian dairy sector faces threat from aggressive pricing, expert warns 

INDIA – The Indian dairy industry, valued at over US$160 billion, is facing significant pressure from global dairy giants using aggressive pricing strategies to capture market share.

In response, Sidhant Gupta, former Director at Kwality, has raised concerns over the growing influence of global dairy giants in the Indian market, warning that their aggressive pricing strategies could destabilize the local dairy sector. 

“The entry of global dairy giants with their aggressive pricing strategies poses a real threat to our small and marginal farmers,” Gupta said, calling for immediate policy interventions to protect India’s local dairy producers.

According to Gupta, while these international companies use deep discounts to capture market share, they also pose a significant risk to the livelihoods of millions of small farmers who rely on dairy farming as their primary source of income.

The Indian dairy industry, valued at over US$160 billion, is the largest in the world, and its extensive ecosystem provides employment and sustenance for millions. 

However, this well-established sector now faces increasing pressure from foreign players, who can leverage their financial strength to absorb the losses incurred through aggressive pricing tactics. 

“Global dairy companies entering the Indian market often employ aggressive pricing strategies and offer deep discounts,” Gupta said. 

This move, according to him, is aimed at attracting cost-conscious consumers but could destabilize the market by undermining local producers.

Sidhant Gupta highlighted that 70% of India’s dairy production comes from small and marginal farmers who are particularly vulnerable to these market forces. 

He emphasized the challenges they face in competing against well-funded global players, who can afford to absorb short-term losses in a way that Indian farmers cannot. 

“These farmers rely heavily on dairy as a primary source of income,” Gupta pointed out, stressing the urgency of policy changes to protect these farmers. 

Without proper regulatory measures, such as minimum support prices or import duties on foreign dairy products, Gupta fears that the entry of international giants could lead to the monopolization of the market, leaving local farmers at a disadvantage.

As consumer preferences evolve, Gupta noted the growing demand for premium and value-added dairy products like organic milk, artisanal cheeses, and fortified yogurts. 

While these shifts present opportunities, they also create challenges for Indian dairy brands that must innovate to meet these new demands while keeping products affordable. 

Despite these pressures, Gupta remains optimistic, suggesting that innovation, policy support, and consumer engagement could help the sector not only survive but thrive in the face of global competition.

Gupta also envisions a future where Indian dairy products are recognized globally for their quality and authenticity. 

He believes the sector can carve out a niche in the international market by leveraging India’s unique strengths, such as its diverse dairy breeds and traditional production methods. 

“By leveraging the country’s unique strengths, Indian brands have the potential to carve out a niche in the international market,” Gupta said.