Andhra govt to challenge Bt cotton pricing

To file case against Monsanto with MRTP panel

The Andhra Pradesh government has decided to file a case with the Monopolies and Restrictive Trade Practices (MRTP) Commission on January 2, 2006, against Monsanto for 'exorbitant pricing of Bt cotton seeds'.

N Raghuveera Reddy, state minister for agriculture, said Nuziveedu Seeds Limited, Mahyco, Proagro Seed Company Limited, Raasi Seeds Private Limited and Mahyco-Monsanto Biotech Limited would be made parties in the case.

The decision was taken following a representation from various sections of the farming community complaining about the price of Bt cotton seeds, he said. Andhra Pradesh would be the first state to challenge Monsanto under the MRTP Act.

Announcing this to the media here on Wednesday, Reddy said that the state government was neither against technology nor against companies. "But the amount charged as royalty by Monsanto is totally unjustified. We want justification for the 'trait value'. We want the price to be reduced."

Bt cotton seeds were sold in the last cropping season at Rs 1,850 for a 450-gm pack. Of which, a major share, Rs 1,250, was paid as royalty to Monsanto for transfer of the 'trait value' into the seed.

"Bt cotton seeds worth Rs 129 crore were sold since 2002 till date in the state, of which Rs 79 crore accrued as royalty to Monsanto," Reddy stated.

Exploitation of farmers through exorbitant royalty for an insect-resistance technology is uncalled for, Reddy said and added, "Monsanto, the patent holder of the Bt technology, neither gives the source material (seeds) nor transfers the gene into the hybrid seed."

The multinational company just shares its technology with domestic companies for production of Bt cotton seed for a huge royalty. While the cotton seed producer gets as little as Rs 200-250 for 750 gm, the Bt cotton grower is paying as high as Rs 1,850 for a 450-gm pack, he said.

To a question on what basis the state can put up reasonable case against the company, Reddy replied, "MRTP Commission is the right institution to intervene and fix the 'trait value'. The information available with us shows that the company charges less on royalty for the 'trait value', accounting for a fraction of the total seed value in some countries."

On criticism against the use of Bt cotton seeds, Reddy said the technology was approved by the Genetic Engineering Approval Committee (GEAC). "We have blacklisted Mahyco-Monsanto Biotech Limited for selling Bt cotton seeds only as they have not agreed to pay compensation to the cotton farmers who have suffered loss," he said.

Of the total 9.5 lakh hectares of cotton under cultivation in the state, the acreage under Bt cotton cultivation is about 5.58 lakh hectares.