Policies in 1990s calls towards liberalisation and globalization make a dramatic shift towards structural transformation. Under such situation, how we can make strategy, preferring a short-term reactive approach over a more coherent long term sustainable approach towards inclusive growth which was emphasized during the existing Plan periods. Dairy sector has the capacity to reduce poverty and to reduce income inequality at the household level. Indian dairy sector has shown tremendous growth in terms of milk production, from 17 million tones (1950-51) to 132.4 million tones (2012-13). To enhance the dairy sector profitability, there is need to put more stress on value addition. To augment value addition in Indian dairy sector policy makers undertaken different policy changes in the post-liberalized era. But MMPO-1992 was introduced in post liberalised era to protect the interest of the cooperative as well as domestic small and medium size dairy plants. This amendment was one of the major policy changes to protect the interest of different stakeholders. Overall growth of dairy sector during the last two decades has been impressive. To restore the value addition in product and to harnessing the consumer market the involvement of organized sector is very much important. As per the finding of study value added products namely butter, cream, ghee, cheese and curd were found to dominate the value chain apart from the manufacture of pasteurized liquid milk in organised dairy sector. The mechanics of the organized sector penetration could be agency-specific as also area-specific. Need of the day is to provide quality input and output support services as provided by the co-operatives (Amul model at Gujarat, Nandani Milk Federation at Karnataka Model), private sector (Nestlé) and contract dairy farming. The scale up or success of each of these models depends upon the value added process which has the potential to satisfy dairy’s inherent complementary nature of farm inputs, resources and institutional components.