Kathmandu, September 3

The government-owned Dairy Development Corporation (DDC) has requested for Rs 16.09 million as grant from the Ministry of Finance (MoF) to safeguard the income of farmers involved in milk production during the flush season to export milk to India.

The request made through its parent ministry — Ministry of Agricultural Development (MoAD) — is aimed at providing incentives to the farmers during the flush season, that is, September to December.

As per Ganga Timsina, general manager of DDC, it costs Rs 5.96 to export each litre of milk to India. The cost is calculated based on the rate adjustment with Indian market and transportation cost. “We have sought alternatives to safeguard farmers from unavoidable milk holiday in this flush season,” he said, adding, “If the finance ministry considers our request, we can export about 30,000 litres of liquid milk every day to the Indian market.”

At present the daily milk collection at DDC stands at 180,000 litres, while the daily demand stands at 150,000 litres.

Normally, April to November is a lean season for milk production in India, which sometimes extends until December. DDC has produced sufficient milk powder and ghee/butter after the April 25 earthquake as the consumption of milk declined drastically in Kathmandu Valley due to the outflow of people for a long time.

Currently, DDC has 120,000 kg milk powder and 140,000 kg butter and ghee in stock, which is why DDC also requested the MoF to raise the tariff on the import of these products for at least six months so that the stock can be cleared.

Likewise, expansion of value added tax rebate amount could also be a solution to clear the existing stock, as per Timsina. “We have requested MoF to raise the VAT rebate to up to 90 per cent from the existing 50 per cent.”

DDC holds 45 per cent market share in the domestic market.