The next section highlights the economic significance of the livestock sector and reviews livestock policies. The two sections that follow describe (respectively) livestock production and marketing systems. The methodology of the paper is discussed in Section V. This is followed in Section VI by a close look at the Idara-e-Kissan cooperative, its institutional model, and its operations. Economic analysis of returns on milk production of IK members and a control group of non-members is presented in the next section. Based on this analysis, Section VIII identifies the successes and limitations of the cooperative. The final section draws conclusions