Financial Daily from THE HINDU group of publications
Tuesday, May 31, 2005
Agri-Biz & Commodities
GEAC move to amend rules for approving Bt cotton Rift between Monsanto sub-licencees, others widens
New Delhi , May 30
SO far the fight was limited to those for or against introduction of Bt cotton hybrids.
Now, a recent Genetic Engineering Approval Committee (GEAC) move has seemingly taken it to different levels those with Bt cotton commercialisation approvals and those without. Additionally, there appears to be a division between Monsanto sub-licencees and non-Monsanto Bt cotton players.
The non-Monsanto section of the seed industry has termed the recent GEAC moves with regards to Bt cotton approvals as being anti-competitive.
The sudden changes introduced by the regulatory body would result in prolonging the monopoly of one technology, Monsanto's Bt cotton, and continuation of high prices of Bt cotton seeds, they charge.
However, Monsanto denies the charge of monopoly.
"About 20 Indian sub-licencees are introducing our gene into their own hybrids, so essentially Bt cotton hybrids will be sold eventually by over 20 Indian companies and, therefore, there is little question of a monopoly in the marketplace," said Ms Ranjana Smetacek, Director - Corporate Affairs, Monsanto.
Having already cleared Bt cotton hybrids that conform to certain minimum norms, how can the GEAC suddenly change the rules for similar hybrids?, these players wonder.
"We are at a loss to understand the rationale for the latest decisions," the All-India Crop Biotechnology Association (AICBA) has stated in a letter sent to the GEAC.
AICBA has about 15 members that include Monsanto, Dupont, Proagro, and about eleven domestic players that are sub-licensees of Monsanto.
AICBA has sought that the approval procedure should be shortened for new hybrids that contain "approved event Mon531" simply put Monsanto licensees. The country has paid royalty to the extent of Rs 100-150 crore for the multinational technology, JK Agri-Genetics has stated in its representation to the GEAC.
JK Agri is not a Monsanto licencee and has developed Bt cotton technology in collaboration with IIT Kharagpur.
With indigenous technology, farmers would get Bt cotton hybrids at reasonable prices, it points out. "Is it ethical to apply the brakes after having approved more than a dozen Monsanto-Bt based hybrids on the basis of single year GEAC trials?," Nath Seeds has asked in its letter.
Nath Seeds has tied up with the Chinese Academy of Agricultural Sciences for transfer of the Bt-cotton technology. The Chinese Bt-cotton technology is Monsanto's competitor in China and has kept the prices in check, it has pointed out.
But Monsanto's Ms Smetacek says: "Our price is lower in India compared with other areas of the world and an IMRB survey of kharif 2004 has found that the net profit increase for Bollgard farmers was Rs ,5950 an acre.
"Another key finding was the reduction of an average 4 to 5 pesticide sprays against bollworm, which translates into a saving of Rs 1137 per acre. Steadily increasing product adoption shows that the Bollgard price is affordable for farmers who buy because they realise more value."
A procedural change introduced by the GEAC recently makes the approval stringent for those Bt cotton hybrids, which are sourced from seeds not yet notified by the Indian Council of Agricultural Research. For those hybrids, GEAC has asked companies to limit their extent of seed production during the first year to one acre only as compared to the earlier limit of 100 hectare (250 acres). In the second year, GEAC may give approval for seed production in about 20 acres. Second, instead of "minimum of one year of large scale trials (LST)" required before giving a go ahead for commercialisation, GEAC had asked companies to conduct "minimum of two years of LST".
Till date, all the Bt cotton hybrids approved for commercialisation belong to companies that are licensees of US-based Monsanto. Many of these approved varieties are sourced from non-notified hybrids that have undergone one year of LST. The seeds of these companies that include Maharashtra Hybrid Seeds Company (Mahyco), Nuziveedu Seeds, Rasi Seeds and Ankur Seeds incorporate the cry1Ac gene, based on Bollgard, the specific gene construct patented by Monsanto.
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