Acumen, a non-profit global venture fund, has announced its new investment in Sahayog Dairy, an integrated dairy company known for supplying milk to central India.

According to a press release issued by the company, dairy is a critical, quickly growing part of India’s agricultural sector with the country standing as the world’s largest producer of milk.

Nearly half of all rural households own a cow or a buffalo, making dairy farming the second most prevalent occupation, while the country’s flourishing urban population has made India the largest consumer of dairy products in the world. Dairy farming, however, remains highly fragmented, relying largely on smallholder farmers who take up dairy production as a supplementary source of income.

“By bringing milk directly from its source—cows and their dairy farmers—to the people of India, Sahayog Dairy creates a fair and transparent marketplace for rural farmers,” said Ajit Mahadevan, director, Acumen India. “Its focus on farmers and enabling them to grow and expand their business is unique and important to creating a successful, sustainable agricultural sector for the country.”

The dairy provides a holistic set of services that can improve a farmer’s business by more than 20 per cent over a period of 12-24 months. The company offers programmes and initiatives, ranging from farmer training to paraveterinary services, employing advanced technology at every step of the process.

“Sahayog Dairy is an important model of rural economic development that places the farmers’ livelihood at the centre of the business model,” said Dr Y S P Thorat, the company’s non-executive chairperson. “We aspire to bring new standards of quality and transparency to the industry that we are confident will benefit producers and customers.”

Since starting operations in 2013, Sahayog has grown to work with 23,000 farmers from more than 300 villages across five districts in Madhya Pradesh. It also operates 272 primary milk collection centres, where milk is tested and evaluated, and smallholder farmers receive an instant receipt for the quality and quantity of milk delivered. The company has set up a state-of-the-art milk chilling and processing plant in Dewas, Madhya Pradesh.

“India’s fast growing dairy industry offers a tremendous opportunity for building inclusive businesses that improve productivity and provide market access for smallholder farmers,” said Siddharth Tata, associate portfolio director, Acumen. “Investing in such enterprises in the dairy industry is core to our investment strategy.”

“We are delighted to be partnering with Acumen in this next stage of our company’s growth. Acumen’s rich expertise in the agricultural sector as well as its deep commitment to social impact made it a natural partner for us,” said Anand Patidar, founder and CEO, Sahayog Dairy.