India-Japan dairy partner to expand into biogas & circular economy

INDIA – India and Japan have ventured into collaboration in non-traditional sectors, with new opportunities emerging in sustainable dairy infrastructure and clean energy solutions. 

One area of growing interest is promoting sustainability and circular economy practices through cooperative-led compressed biogas (CBG) projects.

Establishing CBG plants through dairy cooperatives could boost rural incomes while increasing the use of clean energy.

These projects convert cattle waste into clean fuel and organic fertilizer, providing farmers with an additional, stable source of income. They are also expected to help improve waste management and sanitation and reduce pollution in rural areas.

The cooperative model is particularly well suited to scaling up such initiatives because of its direct links to milk producers across India.

Greater India-Japan collaboration in this field could bring advanced technologies and international best practices to the country’s dairy sector.

Dairying through cooperatives

India has set out an ambitious long-term goal of reaching net-zero greenhouse gas emissions by 2070.

To fulfill this commitment and accelerate progress toward the target, the Indian government has introduced multiple policies to foster growth and investment in new and renewable energy sectors. 

Against this backdrop, biogas stands out as one of the most promising energy resources, drawing on abundant domestic feedstocks such as agricultural residues and animal waste.

At the same time, there is a growing need to make the dairy ecosystem more sustainable by linking biogas plants with dairy cooperatives and strengthening cooperative institutions as key elements in the framework.

Such efforts align with India’s broader vision of Sahkar Se Samriddhi (“Prosperity Through Cooperation”), which aims to strengthen cooperative development and support sustainable rural growth.

Biomethane and fertilizers

One example of India–Japan collaboration is a partnership involving Suzuki Motor Corporation, its wholly owned subsidiary Suzuki R&D Center India Private Limited, the National Dairy Development Board (India’s apex dairy body) and selected dairy cooperatives to produce and supply compressed biomethane gas and organic fertilizers.

Biogas, a carbon-neutral fuel, can be used to power CNG (compressed natural gas) vehicles, which account for approximately 20% of the Indian passenger car market.

The initiative is also expected to improve energy self-sufficiency, create new jobs, and boost rural incomes through the purchase of cattle dung, thereby contributing to higher living standards in rural communities.

Dairy innovation in Bengaluru

Similarly, Akiba Bokujo, a long-established dairy farm operator from Japan’s Chiba Prefecture, plans to launch an integrated facility in Bengaluru covering the entire value chain, from dairy farming to processing and product manufacturing. It initially aims to market premium products such as gelato to luxury hotels, helping to build brand value.

The company also plans to introduce Japanese dairy farming know-how to improve production efficiency in India, leveraging advanced remote management technologies to ensure operational efficiency and product quality.

Akiba Bokujo has also partnered with Stellapps, an Indian agri-tech startup providing digital solutions for dairy farmers. The collaboration will support the introduction of advanced dairy farming technologies and facilitate knowledge transfer aimed at improving productivity.

Beyond business expansion, the partnership seeks to share Japanese dairy expertise with small-scale Indian farmers to help them adopt efficient practices, increase productivity, and improve their incomes.

In a related development in May 2026, MooMark, a Stellapps subsidiary, signed a memorandum of understanding with Akiba Farm Holdings to jointly develop premium gelato products and deepen dairy innovation ties between the two countries.

The initiative spans more than 42,000 villages across 17 Indian states and covers around 3.5 million registered farmers.

The collaboration reflects a shift from traditional foreign dairy investment toward a broader model combining technology transfer and premium dairy ecosystem development.

It brings together Japanese expertise in dairy farming and processing with India’s large-scale digital dairy infrastructure.

With Akiba Farm Holdings’ roughly 140 years of experience in artisanal dairy production, the partnership also plans to establish an innovation lab for dairy product development, inspired by the Japanese concept of takumi, a philosophy centered on mastery and continuous refinement.

Institutional and government cooperation

In May 2026, high-level officials from the Ministry of Cooperation, Government of India, and Japan’s Ministry of Economy, Trade and Industry met to explore collaboration on sustainability and circularity in the dairy sector through CBG plants in dairy cooperatives. This gives fresh impetus to strengthen ties for a sustainable dairy future.

In addition, the Indian government introduced the Revised National Programme for Dairy Development (NPDD) in March 2025, adding 10 billion rupees and raising the total allocation to 27.9 billion rupees for the 15th Finance Commission cycle (2021–22 to 2025–26).

The program focuses on modernizing and expanding dairy infrastructure to support long-term sectoral growth and productivity.

Within this framework, Japan plays a key role under Component B of the program: Dairying through Cooperatives (DTC).

Implemented in cooperation with the Government of Japan and the Japan International Cooperation Agency (JICA), it aims to strengthen dairy development and improve market linkages for village-level produce, while enhancing capacity building from the village to the state level.

This component focuses on the sustainable development of dairy cooperatives by improving production, processing, and marketing infrastructure across nine states, including Andhra Pradesh, Madhya Pradesh, Uttarakhand, Uttar Pradesh, Punjab, Rajasthan, Bihar, Telangana, and West Bengal.

It is supported by an externally aided project funded by JICA and is being implemented on a pilot basis in Uttar Pradesh and Bihar.

Ripple effect across different sectors

India is the world’s largest producer of milk. In 2023–2024, milk production stood at 239.30 million tons, with per capita availability of 471 grams per day. The dairy processing ecosystem has evolved significantly over the years, with strong backward and forward linkages across the value chain. 

The outlook remains positive, driven by changing consumption patterns, rising disposable incomes, and increasing demand for healthy food supplements.

Government regulations and schemes also play a critical role in enhancing milk production, productivity, and processing infrastructure. Together, these factors make India an attractive destination for Japanese investment in the dairy processing sector.

Biogas plants in Gujurat

By introducing advanced Japanese biogas technologies and equipment, five biogas plants will be developed in the state of Gujarat, supported by sophisticated production management know-how for their design and operation. 

These plants will supply biogas as an alternative to fossil-based natural gas for vehicles running on CNG. Gas stations will be installed adjacent to the facilities, and solid and liquid organic fertilizers produced as by-products will be supplied to nearby farmers through the dairy cooperative network.

In addition, measuring greenhouse gas emission reductions across the entire supply chain and generating carbon credits will improve the economic viability of the biogas business.

Through these initiatives, the collaboration aims to promote the transition away from fossil fuels and contribute to the development of a circular economy in India.

Based on the outcomes of this initial demonstration phase, the model is expected to scale into a commercially viable nationwide business model. This is expected to contribute to rural economic revitalization and support India’s goal of achieving net-zero greenhouse gas emissions.

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