Temperature 11.05 C New Delhi, IN
Saturday, December 10, 2022
No Image

Export potential of Indian dairy machinery

Dr. J.V. Parekh

The dairy machinery manufacturing sector has a huge growth potential in terms of export. Even the developed countries like USA and Canada are also focusing on Indian dairy machineries for cost competitiveness. The government needs to incentivize by providing necessary financial, taxation and infrastructure support.

India stands at the number one position in milk production, producing 187 million tonnes per annum. An increased demand for value added dairy products and growing private investment in dairy processing facilities are expected to provide further impetus to India’s milk production over the coming years.

The value of output of dairy industry has reached Rs.10 Lakh crore in the year 2019. Today milk is the largest source of agriculture income in India and the organized sector handles about 20 percent of the total milk production.  As a result of the gigantic growth in milk production, the demand for equipment for processing of milk and milk products has increased substantially. The requirement for dairy equipments has increased from Rs.700 Crore in 2004 to Rs.2000 Crore in 2019.

There are a number of dairy equipment manufacturers in India, including GEA, SSP, IDMC, Tetra Pak, SPX, Goma, HMT, Samarpan, Panchal, Nichrome, ATPL etc. fulfilling the demand of Indian dairy industry. There is a commendable growth in the Indian dairy equipment manufacturing sector but we have yet to make a significant dent in the export market, although there lies a great opportunity for the same.

India has exported dairy equipments to different countries like Nepal, Indonesia, Malaysia, The Middle East, Africa, Sri Lanka, Bangladesh, Iran, North Yemen, Vietnam, Russia, Turkey, Mexico etc. At the present the total export of dairy machinery is approximately Rs.200 Crore.

Overview of Dairy Sector in India

Source: KPMG





Source : Department of Animal husbandry & Dairying, GOI

Industry Overview

The domestic Indian dairy machinery industry is quite self-reliant and proficient in developing a range of machinery such as stainless steel dairy equipments, evaporators, milk refrigerators, storage tanks, milk and cream deodorizers, centrifuges, clarifiers, agitators, homogenizers, chillers, spray dryers, aseptic fillers and heat exchangers. Although the number of dairy equipment manufacturers have increased, healthy competition is prevailing in the industry with the large and established manufacturers undertaking high valued and technically sophisticated equipments and small scale manufacturers sharing the supply of rest of the equipments. By doing so, an attempt is made to minimise the cost of equipment without affecting the performance of the plant.

Research in India has largely concentrated on product development and processing and not much emphasis has been given to the development of equipment and special materials to translate the results of process development into making better food products. A few dairy equipment manufacturing companies have developed in-house R&D facilities to provide customized solutions which is very encouraging.


Productivity Challenges & Roadmap 2025

Source : Department of Animal husbandry & Dairying, GOI

SWOT Analysis of Indian Dairy Equipment Manufacturing Sector



  1. Indigenous availability of raw material and competitive labour cost
  2. Well developed domestic and global demand conditions
  3. The industry at present is equipped with modern machinery, competent engineering & management skills, trained technicians and qualified welders
  4. Strategic location allowing exports to different countries


    B.  Weaknesses

  1. The sector needs advanced global technical capability and investment
  2. Data on production, sales and demand of dairy equipments not available
  3. Inadequately developed linkages between industry and R&D institution
  4. Less effort from manufacturers for global branding

  C.  Opportunities

  1. Good milk production and ready market has lead to establishment of new processing facilities and expansion of the existing ones
  2. Potential to meet the needs of developing countries
  3. Low material and manufacturing cost will help to position equipment manufacturer in the world market
  4. India emerging as a preferred outsourcing destination  among global companies

D. Threats

  1. Non availability of critical components
  2. High level of competition from global players
  3. Import of dairy equipments and plants
  4. Lack of policy coordination among Govt. Bodies

Table 2: Indian Foreign Trade in Dairy Equipment

  Milking machines Dairy machinery


Parts of milking machines Parts of dairy machinery
Year Export Import Export Import Export Import Export Import
Rs. Lacs Rs. Lacs Rs. Lacs Rs. Lacs Rs. Lacs Rs. Lacs Rs. Lacs Rs. Lacs
1996-97 10.01 250.5 136.19 453.94
1997-98 81.41 59.85 914.95 669.64
1998-99 37.82 59.58 127.13 863.51
1999-00 88.43 455.82 334.66 1146.05
2000-01 43.86 59.08 125.28 577.13
2001-02 5.8 40.95 110.15 400.41
2002-03 61.71 26.45 124.51 525.12
2003-04 380.27 71.28 377.17 1289.49
2004-05 45.48 545.13 241.73 1088.74
2005-06 51.01 131.34 251.06 3551.19
2006-07 41.75 602.31 358.62 5376.75
2007-08 314.69 165.98 1132.32 5358.05
2008-09 183.94 2878.38 1218.37 7099.28
2009-10 310.63 913.7 1236.01 4772.8
2010-11 310.63 1340.96 1504.68 5119.54 257.98 462.17 795.24 959.22
2011-12 379.28 1694.48 1846.09 2708.80 108.19 1016.95 580.03 795.32
2012-13 350.54 3021.06 2630.14 3618.91 358.90 565.23 489.07 1641.40
2013-14 84.64 1557.63 4418.44 9559.53 316.77 464.86 493.54 794.25
2014-15 1249.33 2077.97 3481.40 9932.22 64.49 794.85 418.00 1,231.25
2015-16 197.63 1888.75 3772.10 14265.70 68.57 946.71 858.32 848.37
2016-17 183.76 2740.10 3741.80 5011.59 204.85 969.33 1757.16 1996.48
2017-18 489.77 3815.81 4917.65 10057.86 447.57 1091.69 912.01 1106.17
2018-19 520.45 3399.96 3981.99 10865.98 653.50 945.51 588.04 736.13
2019-20 458.24 1316.53 10737.57 7162.14 845.51 1,240.11 491.74 679.37

Source: Ministry of Commerce and Industry, 2020

Strategies for Promotion and Growth

  1. A significant problem facing dairy equipment manufactures today is lack of accurate data/techniques to forecast demand of dairy equipments and components.
  2. Food Industry Associations, Equipment Manufacturers and various institutions have been recommending to the Govt. for total exemption of GST on dairy equipments and machinery required for clean milk production and processing/packaging of milk and milk products.
  3. There is also the concern of increasing the rate of depreciation under Income Tax and reducing the rate of term loan interest to 4% for dairy sector which will directly and indirectly boost machinery manufacturing in the sector.
  4. Indian machinery companies will have to develop manufacturing capabilities to a level where they are competitive across global markets in terms of price, quality, technology, delivery and services.
  5. To achieve this, firms should be supported to access latest technologies from across the globe for the required level of automation, robotics and integrated plant design & operations.
  6. Import of critical components of dairy plant and equipment should be facilitated at low duty, while import of general dairy equipment needs to be restricted and put at higher duty, so that Indian equipment manufacturing can grow.
  7. Indigenous research, development and innovation in equipment design and related special materials & alloys should be strengthened.
  8. An eco system needs to be built up where Govt., industry, research institutions and academicians are facilitated to work in collaboration to improve design capabilities and fabrication quality.
  9. should promote setting up of modern tool/machine rooms in the country to facilitate equipment designers to develop and fabricate machinery.
  10. Large volume equipments made by European machinery manufacturers dominate the global market but there is a huge scope for low cost and small/medium volume equipment which needs to be tapped by Indian equipment manufacturers. There is also ample scope for export of components and field gadgets.

Five Key Investment Opportunities

Source : Department of Animal husbandry & Dairying, GOI

Design of Dairy Equipment for Export

Design of equipment for dairy processing involves consideration of parameters often different from other food processing industries. Interaction of food products with equipment materials/surfaces is a critical factor.  Equipment designers must be fully conversant with the product and its process needs and carefully match the requirements.

Among the important factors are product density, corrosive properties, viscosity, flow velocities, temperature, pressure, state, characteristics of pH, soluble solids, fat content, vulnerability to oxidation, veterinary residues, contamination etc.

Hygienic designing is very important so that the equipment protects the product and processing from all external contamination, microbial ingress/development, spoilage, material reaction, adsorption, lubricant contact, friction effects, leakages, aeration etc. Several international standards have been evolved in order to achieve these features. The standards require adoption of dedicated operating procedures, some being as below.

(a) food contact surfaces should be inert to food under all conditions of use,

(b) surfaces must be smooth and not allow tiny food particles and bacteria to get  deposited in the microscopic spaces,

(c) even internal surfaces should be visible for inspection,

(d) design must facilitate easy dismantling of parts for cleaning,

(e) providing air tight covers and other protections to prevent contamination,

(f) avoiding sharp corners, cracks and crevices, which may harbor microbes difficult to dislodge by normal cleaning,

(g) protecting from unnecessary creation of hot spots,

(h) ensuring high energy efficiency,

(i) facilitating easy and low cost maintenance,

(j) providing measures for operational safety,

(k) easy to take product samples during processing at the desired stages,

(l) adequate display of process parameters,

(m) all connections, joints, valves, seals, ports should be leak proof,

(n) test probes, gauges, thermometers to be of very superior quality and optimally placed,

(o) where ever required the system/structure should be based on anti vibration mountings,

(p) providing high quality food grade lubrication

The Way Forward

Production and Export data for dairy machinery shows a growing trend of dairy equipment exports from India which is a good sign as illustrated in Table 2 above. There is a vast export potential of dairy equipment to a number of countries such Nepal, Indonesia, Malaysia, The Middle East, Africa, Sri Lanka, Bangladesh, Iran, North Yemen, Vietnam, Russia, Turkey, Mexico etc. At the present the total export of dairy machinery from India is approximately Rs.200 Crore which is very little.  Many developed countries including US and Canada are also focusing on Indian dairy equipment manufacturers for meeting their equipment needs at reasonable cost.  Many machinery manufacturers hitherto operating in China are looking to relocate/joint venture with Indian companies. All such opportunities should be explored and tapped soon.

Crucial steps and synergies have to be adopted by the Industry, Research Institutions, Technology Partners and Materials Innovation Labs to achieve these goals.  The government has a big role to play in this export transformation by way of policy intervention and providing necessary financial, taxation and infrastructure support.  We visualize a huge growth in the dairy machinery manufacturing sector in the near future.

This will have a major multiplier effect on agriculture & rural economy, food processing industry, skills & employment generation and become a big contributor to India’s aspirations of being self-reliant and establishing our global presence in the dairy sector as a whole.

(Dr. J.V. Parekh is  Senior International Dairy Consultant. views expressed are personal.)