Building Strong Dairy Cooperatives: NDDB’s Approach to Institutional Development

India is home to the world’s largest dairy cooperative network, and at the heart of it is a deceptively simple idea: milk producers should own, govern, and benefit from the institutions that process and sell their milk. This idea, championed by the National Dairy Development Board (NDDB), has shaped how dairy cooperatives are built across the country – not just as business ventures, but as self-reliant, democratically controlled institutions rooted in rural communities. Understanding how NDDB approaches cooperative development and institution building reveals a blueprint that goes far beyond milk procurement.

Principles of cooperative development: the NDDB philosophy 🔗

NDDB was established with a foundational conviction: that India’s socio-economic progress depends on developing rural communities, and that this development must be led by the producers themselves. According to NDDB, its Dairy Board was created to promote, finance, and support producer-owned and controlled organisations, with cooperative strategies and principles forming the bedrock of all its efforts.

This philosophy draws directly from the Anand Pattern – the cooperative model pioneered by the Kaira District Cooperative Milk Producers’ Union (Amul) in Gujarat. When Prime Minister Lal Bahadur Shastri saw how Amul had transformed the lives of marginal milk producers, he wanted that model replicated across India. NDDB was the vehicle to do exactly that. By the time NDDB’s flagship Operation Flood concluded, India had over 81,000 dairy cooperatives formed on the Amul pattern.

At the core of this philosophy are two non-negotiables: self-reliance and democratic control. A cooperative is only as strong as its members’ ownership of it – not just in legal terms, but in terms of awareness, participation, and decision-making. NDDB’s institution-building work is designed to make both of these real, not aspirational.

The two-tier structure of institution building 🔗

NDDB’s institution-building efforts operate at two distinct levels: the Village Dairy Cooperative Society (DCS) level and the Milk Union (district or regional) level. This dual-level approach is intentional – each tier has different needs and different governance challenges.

At the DCS level, the focus is on creating a shared vision among all producer members, management committee members, and staff. The goal is to empower the society to make its own decisions, adopt cooperative principles, and align its day-to-day activities with its core purpose – serving its members. This is where the foundational work happens: ensuring that a small village-level cooperative actually functions democratically and transparently.

At the Milk Union level, NDDB supports district or regional unions to become viable business enterprises. This means helping boards of directors, managers, and employees take genuine ownership of their responsibilities. It also involves facilitating the development of long-term strategies that balance business growth with member satisfaction. Policy-based governance – rooted in cooperative values – is the standard NDDB works toward at this level.

Training and governance programs: building capable cooperatives from within 🔗

A cooperative with good intentions but untrained members is unlikely to succeed. NDDB has long recognised this, which is why its Cooperative Services Group provides technical and managerial support to strengthen governance, financial management, and operational efficiency across cooperative societies. The group runs extensive capacity-building initiatives targeting members, management committees, and professional staff.

Cooperative training programmes cover a wide range of practical skills: fair and transparent milk procurement techniques, the principles of cooperation, extension communication, business management, and quality assurance. Board members from milk unions across the country are regularly oriented to improve their governance capabilities. Improvement of governance in cooperatives remains a high priority for NDDB, and this shows in the scale and regularity of its training calendar.

NDDB also operates dedicated training centres and runs both residential and field-based programmes for producers, secretaries, and union-level professionals. Topics range from animal health management and ration balancing to cooperative law, SWOT analysis, and long-term planning – giving participants both the technical and organisational skills they need to run sustainable institutions.

Women’s leadership: from the margins to the management committee 🔗

One of the most significant dimensions of NDDB’s governance work is its sustained effort to bring women from the periphery of dairy cooperatives into their governing structures. Women provide an estimated 70% of the labour in dairy operations in India, yet historically they were underrepresented in cooperative membership and almost entirely absent from leadership roles.

NDDB took a structured approach to change this. The Women’s Dairy Cooperative Leadership Programme (WDCLP) was launched in 1995 as a pilot in Valsad, Kolhapur, Wayanad, and Goa, with the objective of significantly increasing women’s participation as both active members and as leaders in governance. The programme was successful enough to be replicated across the country.

Key activities under WDCLP included the organisation of women’s clubs, literacy programmes, thrift and credit groups, exposure visits, and dedicated training on management committee roles, member rights, and cooperative principles. The results were tangible: leadership development and greater governance participation followed directly from this programme. NDDB continues to organise seminars, conferences, and training programmes to help women develop leadership qualities and increase their overall representation in the cooperative system.

The numbers reflect the commitment. NDDB envisages enhancing women’s participation in dairy cooperatives to 50%, with a target that every new cooperative society formed should be a women’s DCS. The Government of India reinforced this through a constitutional amendment mandating at least two female members on cooperative governing boards. Additionally, NDDB has supported the establishment of fully women-run cooperatives such as Shreeja Milk Producer Company and the Mulukanoor Women’s Mutually Aided Milk Producers Cooperative Union.

From 1988 onwards, NDDB placed major emphasis on women’s education and capacity building as part of its Cooperative Development programme, and it actively encourages at least 50% of trainees in its programmes to be women. Training programmes exclusively designed for women have also been promoted to build skills in cooperative management, animal husbandry, and financial literacy.

Long-term sustainability and community impact 🔗

Institution building is not a one-time intervention – it is an ongoing commitment. A cooperative that receives initial support but lacks the internal capacity to govern itself, resolve disputes, plan strategically, and adapt to market changes will eventually stagnate or collapse. NDDB’s approach is designed to prevent this by building institutional muscle over time.

The Revitalising Promising Producers’ Owned Institutions (RPPOI) scheme is a clear expression of this long-term thinking. The scheme aims to support promising Producer-Owned Institutions to strengthen their overall business operations, increase market share, and create self-sustaining institutions that benefit all stakeholders. Financial assistance is available in the form of grants (up to ₹3 crore per institution) and interest-free secured loans (up to ₹5 crore per institution), provided over a multi-year period to allow for genuine transformation.

This kind of support is not a subsidy for dependence. It is a scaffold – designed to be removed once the institution can stand on its own. The emphasis throughout is on the cooperative developing the skills, systems, and governance structures to sustain itself without continued external intervention.

Rural prosperity as the ultimate outcome 🔗

The downstream effects of strong cooperative institutions on rural communities are substantial. When a dairy cooperative is well-governed and financially sound, it does more than process milk. It provides reliable income to thousands of small and marginal farmers. It ensures fair, transparent pricing. It funds veterinary services, animal nutrition support, and extension programmes. It connects rural producers to urban markets without the exploitation that characterised the pre-cooperative era.

NDDB’s efforts transformed India’s rural economy by making dairying a viable and profitable economic activity for millions of milk producers while addressing the country’s need for self-sufficiency in milk production. The cooperative sector now procures a significant share of India’s marketed milk surplus, and this organised channel is what gives small dairy farmers bargaining power in a market-driven economy.

Beyond milk, NDDB has used the cooperative network as a platform for wider rural development. Cooperatives have been mobilised for beekeeping, solar energy cooperatives, manure value chains, and nutrition programmes like the Giftmilk initiative. The Cooperative Services Group has been expanding its horizons by leveraging the dairy cooperative network to create additional livelihood opportunities in beekeeping, fodder, fruits, and vegetables – building altogether new cooperative enterprises alongside dairy.

A replicable model with global relevance 🔗

The institution-building approach that NDDB has refined over six decades has not gone unnoticed internationally. The United Nations and international development agencies have highlighted NDDB’s approach as a case study in sustainable rural development, and countries in Asia and Africa have studied and adapted elements of this model. NDDB has provided direct technical assistance to Sri Lanka and Kenya in recent years, helping them develop cooperative-based dairy sectors of their own.

What makes this model durable is not its scale alone, but its internal logic: when producers own the institution, have a voice in its governance, and are trained to exercise that voice, they have every reason to make it work. The cooperative becomes a genuine extension of their economic interests, not an external service provider they depend on passively.

Dairy cooperatives built on these principles are not simply business enterprises. They are democratic institutions, training grounds for rural leadership, and engines of community development – all rolled into one. NDDB’s contribution has been to build those institutions systematically, brick by brick, member by member.

What do you think? Given that women contribute the majority of labour in dairy operations yet have historically been underrepresented in cooperative governance, what structural changes – beyond training programmes – could further accelerate their inclusion in leadership roles? And can the NDDB model of producer-owned, self-reliant cooperatives be effectively adapted to other agricultural sectors in India, such as fisheries or horticulture?

References

1. https://www.nddb.coop/about
2. https://en.wikipedia.org/wiki/National_Dairy_Development_Board
3. https://www.nddb.coop/services/cooperative/institution-building
4. https://beta.nddb.coop/what-we-do/cooperative-services/
5. https://www.nddb.coop/sites/default/files/pdfs/nddb-annual-report-2013-2014.pdf
6. https://www.nddb.coop/services/cooperative/enhancing-women-involvement-in-cooperation
7. https://fil-idf.org/dairy-declaration/india-enhancing-participation-of-women-dairy-farmers-in-governance-and-management-of-dairy-cooperatives-2019/
8. https://www.nddb.coop/node/1367
9. https://thelaw.institute/co-operation-genesis-principles-values-growth-and-development/nddb-contribution-india-dairy-cooperative-movement/