The White Revolution, also known as Operation Flood, gave a major boost to the dairy sector in India in the late 1960s by producing milk in rural areas through smallholder producer cooperatives and moving industrially-processed milk from these smallholder sources to urban demand centers. This established the much-needed linkages between rural producers and urban consumers. The growth achieved has been uninterrupted ever since and culminated in India becoming the world's single largest producer of milk since the mid-1990s.
And with over 80-million farming households involved in dairy related activities, the dairy industry has emerged as a single largest contributor to the Indian economy. More than 70 per cent of India's milk is produced by households who own only one or two milk animals.
Matching Supply and Demand
The White Revolution carried on the extensive dairy development programs on the supply side, and this, coupled with increasing demand for value-added milk products on the consumer side, along with the country’s population growth, increased urbanization and higher income, led to increased demand for milk.
Other factors which contributed to growth in milk production are
• In the Indian diet milk and dairy products have a cultural significance
• With a large lacto-vegetarian population, milk and dairy products are an important source of protein in the diet
• There is a perceptible shift towards value-added food habits in which milk products form a large part
• On the supply side, technological progress in the production and processing sectors, institutional factors, and infrastructure played an important role.
Protection to Industry
Small enterprises and cooperatives, with whom milk processing and product manufacturing were mainly restricted, were give protection by means of high import duties, non-tariff barriers, restrictions on imports and exports, and stringent licensing provisions. This also provided supplementary employment and income among the small and marginal farming households and landless wage earners
Scenario Before White Revolution
Before the White Revolution started the farmer’s income was derived almost entirely from seasonal crops. The income from milch buffaloes was undependable. Only private traders and middlemen gained as the marketing and distribution system for milk was controlled by them. Being perishable, farmers were forced to sell milk to whoever offered to buy. Often, they had to sell the cream of the milk at throwaway prices.
The level of integration of the country's dairy sector with the global economy is relatively low. The domestic market is largely insulated from global market influences, unlike other sectors such as edible oil.
In spite of being the world’s largest producer, India has a negligible share in international milk trade. Indian export of skimmed milk powder and butter has rarely exceeded a few hundred tons. This is essentially because India has a huge domestic market whereas the limited domestic market in industrialized countries gives them the added incentive to export.
Even in the domestic market there appears to be inequitable distribution. Today the daily per capita consumption of milk in the country is little over 250-ml as against 106-ml when Operation Flood was launched three decades ago. But still this is below the world average of 285 grams per day, and also lower than the minimum nutritional requirement of 280 grams per day as recommended by the Indian Council of Medical Research (ICMR). As a result, 53 per cent of children below 5 yrs are malnourished, for lack of milk which is a vital input for food and nutrition.
Productivity of cattle in India is 10 per cent of those in Israel and about 30 per cent of productivity in developed countries. Milk available to Indians contains over 50 million bacteria per ml against the Bureau of Standards  maximum permissible bacterial count of 30,000 per ml.
Reasons for low milk yield among cows in India are:
• Lack of use of scientific practices in milching
• Inadequate availability of fodder in all seasons
• Unavailability of veterinary health services