Banas Dairy is set to increase its daily cattle-dung processing capacity by 51 per cent to 515 tonnes from 340 tonnes with new bio-CNG plants at Tharad and Radhanpur in Gujarat’s Banaskantha district, expanding a model that provides cattle farmers an additional income stream beyond milk sales.
The dairy cooperative purchases dung from farmers at around ₹1 per kg, weighing it at the farm and depositing payments directly into their bank accounts every fortnight along with their milk bills. The initiative converts livestock waste into compressed biogas for vehicles and organic fertiliser for farms, creating an additional revenue stream from cattle rearing.
The expansion comes ahead of Prime Minister Narendra Modi’s visit to Banaskantha on October 30. Banas Dairy currently processes 340 tonnes of dung daily through four plants. With the addition of the Tharad and Radhanpur facilities, the network’s processing capacity is expected to rise to 515 tonnes a day. The cooperative began procuring dung in February 2020 from Dama village in Deesa and launched what the state government describes as the country’s first commercial-standard compressed biogas (CBG) outlet in August that year. Plants subsequently became operational at Agathala, Khula and Vinchhiwada under a tripartite arrangement involving Suzuki Motor Corporation and the National Dairy Development Board (NDDB).
Banaskantha district has an estimated 28 lakh livestock, of which around 24 lakh belong to cattle breeders associated with Banas Dairy. These animals generate approximately 24,000 tonnes of dung daily, providing considerable scope to expand the cooperative’s bioenergy operations.
The cooperative plans to eventually establish around 200 plants to utilise the district’s livestock waste. According to the state government’s Energy and Petrochemicals Department, the proposed network could produce 1,168 lakh kg of compressed biogas annually and generate direct annual returns of ₹875 crore for livestock farmers. These figures represent the projected potential of the expanded network, rather than its current output.
The bio-CNG produced at the existing plants is sold to motorists at ₹75-80 per kg, below Gujarat’s prevailing conventional CNG price of around ₹92 per kg. The process also generates solid and liquid organic fertilisers from the residual slurry, which are supplied to farmers through local milk societies under the Bhoomi Amrut brand.
The model is designed to provide cattle breeders with multiple economic benefits including regular payments for dung, access to organic fertiliser and the prospect of lower-cost vehicle fuel. Direct payments alongside milk bills also integrate dung procurement into the cooperative’s existing farmer-payment system. The initiative also forms part of a wider India-Japan cooperative effort to establish 1,000 biogas plants across the country.
Published on October 27, 2026
