Kathmandu, August 24
The Supreme Court has ordered the government to ensure the immediate payment of outstanding dues owed to dairy farmers and establish a system for ensuring that farmers are paid regularly for their milk.
A division bench of Justices Nahakul Subedi and Sunil Kumar Pokharel issued the order, directing the Ministry of Agriculture and Livestock Development to facilitate payment of all outstanding amounts owed to milk producers by the Dairy Development Corporation (DDC) and private dairy industries.
The court ordered the ministry to make “appropriate and necessary arrangements” to ensure that outstanding payments are made immediately and that milk producers are paid within a regular payment cycle in the future.
The court also directed the ministry to promote and develop the dairy sector.
Farmers owed around Rs 7 billion
The order came after lawyers Dr Punya Prasad Khatiwada and Dipak Bikram Mishra filed a writ petition seeking payment of the dues owed to dairy farmers.
At the time of the petition, dairy farmers were reportedly owed around Rs 7 billion, including approximately Rs 6 billion by private dairy industries affiliated with the Dairy Industry Association and Dairy Association, and around Rs 900 million by the government-owned DDC.
Around three million families are estimated to be directly or indirectly involved in Nepal’s dairy sector, keeping approximately 7.4 million cattle and 5.2 million buffaloes.
The petitioners argued that many dairy farmers had not received payment for milk supplied over three to four months, discouraging them from continuing livestock farming.
DDC had unsold dairy products
According to details submitted by the DDC to the government through the Ministry of Agriculture, the corporation had approximately 900 metric tonnes of milk powder, 700 tonnes of butter, three tonnes of paneer, three tonnes of mozzarella, 12 tonnes of yak cheese and five tonnes of Kanchan cheese in stock.
The DDC had prepared a plan to pay dairy farmers, citing around Rs 1.5 billion worth of dairy products that remained unpaid.
The issue had also been discussed between the Agriculture Ministry, DDC and representatives of farmers in February 2024. An agreement was reached at the time, following which farmers suspended their protests, but the outstanding payments were not cleared as expected.
Previous Supreme Court order also went unimplemented
The Supreme Court had issued a three-point directive around two and a half years ago, in February 2024, ordering authorities to address the dairy farmers’ problems within 15 days.
The court had directed the Agriculture Ministry, DDC, Dairy Cooperative Limited, Nepal Dairy Association and private dairy industries to submit a plan for clearing outstanding payments owed to dairy farmers.
It had also ordered authorities to determine why payments had not been made and prepare a realistic timetable for clearing the dues.
The court further instructed the Agriculture Ministry and the National Dairy Development Board to monitor implementation of agreements between dairy industries and farmers.
Despite those directives and an agreement between the government and farmer representatives, payment problems continued.
Government promises shorter payment cycle
Last week, Agriculture Minister Geeta Chaudhary claimed that the maximum period for milk payments would be limited to 25 days by the final week of Bhadra.
She also said the DDC had paid Rs 600 million to farmers over the previous three months.
However, the Supreme Court has stressed that milk farmers in an agriculture-dependent country should not have to wait for long periods to receive payment for their produce.
The court said the state must take an active role in creating an environment in which farmers receive their payments on time.
The full text of the ruling, issued in December 2024, was made public by the Supreme Court on Sunday, around a year and a half after the judgment.
According to the court, the publication of the full text was delayed after case files were taken away following the events of September 9, 2025.
