Livestock is central to livelihood of the rural poor in the country and is considered a more secure source of income for the small farmers and landless poor; and, is a source of employment generation at the rural level. It also helps to reduce income variability, especially in cases of crop failure due to a variety of causes and can play an important role in poverty alleviation by uplifting the socioeconomic condition of Pakistan’s rural masses. Milk and meat are the major produce of the livestock farmer. Pakistan is the 4th largest milk producing country in the world with annual milk production of 47.951 million ton (Economic survey of Pakistan 2011-12). Adding the value to milk and converting the milk into value added products will decrease the losses of milk which are 15 % (Economic survey of Pakistan 2011-12) during transportation which can be even high during summer season when the temperature is very high. There is lack of cold storage facility of milk with the poor farmers moreover they are not trained enough technically to add value to milk and convert it into value added healthy dairy products like yoghurt (flavoured), butter, desi ghee and cheese. There is a need for the value chain development for the dairy products produced from the farmer to the end consumer.Value chain development in return will increase the income of the farmer. It also opens the new avenues of research to explore further in product development. Poor farmers and the end consumers of the product are the major stakeholder who want to see the change happening. Value chain development benefits the easy delivery of the product from the farmer to the retailer and the end consumer. Value added dairy products benefit the consumer in improving their health status. Decrease in the losses of milk with increase in the sale volume of value added dairy products along with the income and profit of the farmers will be the key performance indicator of the success. Sustained farmer approach towards value chain development and bridging up the gap of farmer community with retail market will in turn improve the livelihood of the poor farmer due to this change.
Keywords: Modern, Dairy, Value Chain, Pakistan, Poverty, Development