The Supreme Court has issued a writ of mandamus ordering the government to ensure that dairy farmers are paid their outstanding dues without delay. The court ruled that prolonged non-payment by dairy industries and the state-owned Dairy Development Corporation (DDC) has violated farmers’ constitutional rights.

Although the verdict was issued in December 2024, the full text of the ruling by a division bench of Justices Nahakul Subedi and Sunil Kumar Pokharel was made public only on Sunday.

The court ordered the government to ensure that the DDC and private dairy companies clear all outstanding payments owed to milk-producing farmers.

The bench found that the failure to make timely payments had adversely affected farmers and amounted to a serious violation of their constitutional rights.

“The failure to make timely payment of outstanding amounts owed to milk-producing farmers appears to have seriously violated their constitutionally guaranteed rights to property, social justice and a dignified life,” the judgment says.

The court said the government has a duty to address the situation immediately and directed the Ministry of Agriculture, Forests and Environment to implement an agreement reached on June 30, 2024, between the government and stakeholders in the dairy sector.

The agreement requires the DDC and private dairy industries to immediately clear outstanding payments to milk producers, establish a system for making regular payments for milk in future, and take measures to promote and develop the overall dairy sector.

The apex court also directed the government to make any necessary policy, legal and administrative arrangements and provide facilitation required to implement the order.

The writ petition was filed by lawyers Punya Prasad Khatiwada and Dipak Bikram Mishra after dairy farmers were owed around Rs7 billion. According to the petition, private dairy companies represented by the Dairy Industries Association and Nepal Dairy Association owed farmers about Rs6 billion, while the DDC had outstanding dues of around Rs900 million.

The court’s ruling comes as the dairy sector remains a major source of livelihood across the country, with around three million families estimated to be directly or indirectly involved in dairy production.