1. Editorial: Modi vs Monsanto

Editorial: Modi vs Monsanto

GM seed firm right in threatening to pull out of India

By: | Published: March 5, 2016 1:11 AM

Given how finance minister Arun Jaitley has said doubling the return of farmers in the next five years is one of the government’s top priorities, you would think promoting the use of advanced technology in agriculture would be a focus area, especially since global warming is also playing havoc with the farm sector. The reality seems to be the exact opposite. Not only is the government pandering to the RSS lobby by delaying trials of genetically modified (GM) crops—Pakistan has just cleared the use of herbicide-tolerant GM corn and, apart from brinjal, Bangladesh has just approved GM potato—it is even putting the squeeze on Monsanto, the primary producer of Bt cotton seeds in the country. This is intriguing since, not only was Gujarat’s agricultural growth during the time Narendra Modi was chief minister primarily driven by Bt cotton, the dispute was essentially one between a few seed companies and Monsanto—while the state governments in Maharashtra, Telangana and Andhra Pradesh backed the seed companies that were franchisees of Monsanto’s technology, Monsanto was fighting them in local courts. So, the Modi government didn’t really need to come into the picture.

Yet, it did, and twice. To begin with, it brought the seeds under price control and set up a committee that was supposed to fix both the price of the seeds and, within this, the royalty that Monsanto got. According to a report in Mint, the committee has recommended a 70% reduction in the royalty on Bollgard II, the main seed Monsanto sells. Given that the royalty rate is just 1-2% of the cost of cultivation, not only is Monsanto upset, its India chief has threatened to relook the company’s strategy in India. This is bad news for various reasons since, like antibiotics, the impact of Monsanto’s protein-enhancement—that’s what genetic modification boils down to eventually—wears off over a period of time; in the event, if the company does not come up with new products, farmers will find their crops being eaten up by insects all over again. To put this in perspective, at $1.7 billion a year, Monsanto’s R&D budget for GM crops is higher than that of the government of India—right now, for instance, Monsanto is in the process of getting regulatory approvals for a combination of Bollgard II with its Roundup Ready Flex herbicide and even a Bollgard III. If this wasn’t bad enough, the central government’s ministry of agriculture approached the Competition Commission of India (CCI), asking it to probe whether Monsanto was guilty of price gouging and other anti-competitive practices. While the CCI has ordered an investigation, it appears to have already made up its mind—in its ruling authorising an investigation, it said “the Commission notes that imposition of such conditions … not only discourages the sub-licensees from dealing with the competitors, but also amounts to restriction of development of alternate Bt cotton technologies”; and on the issue of royalty (trait fee, in jargon), it said “charging of trait fee … apparently has no economic justification … and appears to be unfair”. Given how the government is engaged in serious litigation with so many large firms—Vodafone Plc and Cairn Energy among the global ones and Reliance Industries among the local ones—it is difficult to see how it expects them to contribute to Make-in-India or, in the case of Monsanto, Cultivate-in-India.

  1. A
    Anil Chauhan
    Mar 7, 2016 at 2:59 am
    The problem is that the government is influenced by emotive and political interests by some local seed companies who raise the bogey of monopoly. The GOI has hundreds of research insutes and agricultural university who have not produced a single GM technology since 1947 Every one seems to be basking in the glory of the 1960s green revolution. The one GM mustard developed by Dr Pental is mired in controversy. If one looks around bangaldesh has surged ahead and last week stan has agreed to grow GM maize The problem is that India has never had any bold leaders either in the agricultural research or the political establishment. We continue to follow others. We will adopt GM food crops after our neighbours. Sorry state of affairs.
    1. I
      Ijaz Ahmad
      Mar 8, 2016 at 1:50 pm
      stan Govt regulatory body National Biosafety Committee (NBC) never approved any GM Corn since stani scientists caught red handed while trying to permit Monsanto, Dupont and Syngenta GMO Corn trials and commercialization. The News Int. reported
      1. M
        Mango Man
        Mar 5, 2016 at 7:00 am
        India doesnt need Monsanto or its GM seeds. If one analyses the root cause of farmer suicides in India, one of the prinl causes would be Monsanto & its GM seeds wrecking havoc in sustainable agriculture amongst our poor farmers. The collective greed of Monsanto & the likes PLUS the politicians of the previous govt. has caused depletion of the soil, water, bees, butterflies, etc. to kill self sustenance and increased dependence on these mega corporations for seeds, fertilizers, pesticides .... i.e. higher costs & lower yields to bring the farmer back to 'bonded labour / slave' status of the 1800s. This is colonization of the country in a new way ..... Monsanto is the East India Company in a new avatar !!!!
        1. N
          Mar 6, 2016 at 9:15 am
          This editorial is a completely one-sided write-up. If Monsanto withdraws, "farmers will find their crops being eaten up by insects all over again". It is if Indian agriculture is dependent solely on Monsanto and the 'great services' it is doing. Because of Monsanto protein enhanced technology, farmers are facing new and newly adapted insects. They are now caught between a devil and deep sea. This story does not question raking in crores of rupees, in the name of royalty, for protein enhancement which is wearing off. Why should royalty be paid for years together for such a unstable technology? It does not bring up how royalty instead of decreasing over years has been increasing in absolute terms. does it make business sense to palm off a obsolete technology, and pander to profit-mongering?
          1. K
            Mar 16, 2016 at 10:32 am
            Shame on you Financial Express for supporting an MNC who tried to kill the Indian farmers and destroy the Indian Agriculture .
            1. S
              Mar 5, 2016 at 5:50 am
              GM should be banned. Together with chemical fertilizers and pesticides. There is established research on their deleterious effects on food production as well as consumer health. My own Guru, Mokichi Okada (an) conducted extensive research on the importance of harmonizing with nature in the matter of food production and established the dangers of deviating from this by empirical scientific research. Further, as GM is a commercialization of nature, it comes with strings attached. GM crops do not produce seed, increasing dependence (vulnerability) to seed producers. GM also attacks neighbouring fields and propagates plant sterility inducing dependence on GM seed producers. In India, there is no food scarcity. Only scarcity of "last mile" infrastructure and laws and law enforcement against market manition by the State and other forces in matters related to food. In 1983, as Long Range Planning Officer for the State Bank of India, (7th five year plan), my Delphi that included such doyens as Dr V.K.R.V.Rao established that the TOP priority for India was rural roads and storage facilities for food as this would more than quintuple India's GDP and abolish hunger without the need for chemical fertilizers and pesticides that degrade the agricultural environment and poison consumers as more than 70% of agricultural produce rots in the fields due to the lack of infrastructure and market manition. Naturally, the satraps of the Indian Govt who, inter-alia, run The Planning Commission killed it as ultra vires the vested interests. This reminds me of a recent response to the suggestion that there must be Railway Fly overs to allow elephants to p safely underneath. The Govt feels that elephants may not choose to take the fly overs constructed for them to cross the railway tracks(!) Way back in 1973 I was part of a campaign of the hi Bazaar "Somari Katte" led by "Bod" Sundaram FRPS of Zoom Photographics from the pages of the Deccan Herald that established the technical and commercial viability together with the imperative of having an elevated mono rail around Bangalore. It was killed. Because the politicians, police, and bureaucrats owned the auto rikshaws and leased them out to the drivers!
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