Monsanto threatens to exit India over GM royalty row

NEW DELHI: Monsanto has threatened to stop bringing new technologies to India and review its entire business in the country if the government forces a cut in technology fee on Bt cotton. The US giant is worried as the agriculture ministry is likely to enforce a sharp cut in the technology fee to reduce the price of cotton seeds next week, just before farmers plant cotton in many states. A panel appointed under the Cotton Seed Price Control Order by the agriculture ministry has recommended a 70% cut in trait fee. The company has already challenged the government’s price-control move in the Delhi High Court.

"We sincerely hope that the government will be fair in its approach and that certain reports in the public domain are false. If the committee recommends imposing a sharp, mandatory cut in the trait fees paid on Btcotton seeds, MMB will have no choice but to reevaluate every aspect of our position in India,” said Shilpa Divekar Nirula, CEO of Monsanto India Region, in a press statement.

Mahyco Monsanto Biotech (MMB) is a joint venture between Monsanto and India’s Mahyco. The company said any move to cut the fee will hurt innovation as well as the interest of 7 million farmers who have gained from Monsanto’s technology.

Monsanto said the use of Bollgard technology has increased cotton yields to 552 kg per hectare in 2013-14 from 302 kg in 2002-03, transforming India from being a cotton importer to becoming the world’s top producer.

It says this helped generate additional farm income of Rs 110,000 crore.

Monsanto said the government’s intervention comes against the backdrop of a bilateral dispute where licensees refused to honour commitments to pay more than Rs 450 crore. Meanwhile, the National Seed Association of India, which has recommended cotton seed price of Rs 850 per 450 gram of packet, said they were confident of bringing alternate technologies to replace the currently failed Bollgard II technology to control the pink bollworm.