In a move addressing supply chain and logistics costs, the government also announced a major hike in the freight subsidy for milk collected by private cooperatives. This subsidy has been doubled, increasing from ₹1.50 to ₹3 per liter, with ₹1.59 crore being distributed at this revised rate. Collectively, these initiatives—the incentive and the increased subsidy—are projected to provide an annual financial benefit of ₹18.24 crore to the state’s dairy producers, significantly enhancing farm gate returns and dairy economics.

These new programs complement existing aggressive government pricing strategies. Himachal Pradesh is currently the only state in India where cow milk is purchased at ₹51 per liter and buffalo milk at ₹61 per liter through the Himachal Pradesh Milk Federation (MilkFed). Additionally, the government has increased milk procurement prices by ₹21 in the last two years and supports diversified farm income by purchasing cow dung at ₹3 per kilogram, along with offering Minimum Support Prices (MSP) for naturally grown agricultural commodities.

Looking ahead, the state is investing heavily in expanding dairy infrastructure and outreach. The government aims to strengthen local procurement networks, with a campaign launched in June 2025 having already established 320 milk cooperative societies. The goal is to set up a cooperative in every gram panchayat (village council) with substantial milk availability. Concurrently, a new, large-scale milk processing plant with a capacity of 2 lakh liters per day is under construction at Dhagwar in Kangra.