Keeping farmer interest in mind Association of Biotech Led Enterprises –
Agriculture Focused Group (ABLE- AG) opposes Government`s Cotton Seed
Price Control Order
Arbitrary decisions threaten future investments in R&D; is contrary to the Government’s
“Make in India” campaign and impacts ease-of-doing-business
Innovation in agriculture is a key imperative and must be respected
New Delhi, 21st December 2015: Association of Biotech Led Enterprises – Agriculture
focused Group (ABLE- AG), a non-profit organization to promote research and development
of agriculture biotechnology in India to bring the latest and most relevant technologies to
Indian farmers, today expressed serious concern with regards to the recent decision by the
Ministry of Agriculture and Farmers Welfare, Government of India to regulate the maximum
sale price of cotton seeds in the country. The order also aims to control the licence fee,
Royalty trait fee and licensing terms on which technology providers make available innovative
technologies for the benefit of Indian cotton farmers through cotton seed companies on
extensively negotiated terms set out in mutually agreed bilateral private contracts. ABLE-AG
also questions the decision making process that involved no prior information, discussion, or
consultation by the Ministry with the association or any of its constituent organisations or
technology developer and provider and any other Stakeholder in general.
Commenting on the issue that has emerged as one of great concern to the industry, Mr. Ram
Kaundinya, Director General, Association of Biotech Led Enterprises – Agriculture focused
Group said, “Being an association committed to the improvement of Indian agriculture
through biotechnology, we strongly oppose the order and the manner in which it was adopted.
While a part of the Order seeks to determine Maximum Sale Price of cotton seed under the
Essential Commodities Act, it surprisingly extends to fixing a component thereof associated
with innovation. We are saddened that such action has been taken without our Association or
any member company being consulted on the same. We believe such a step hampers
confidence in making investments in innovative research & development and is contrary to the
Government’s ‘Make in India’ campaign and impacts ease of doing business. We have also
written to concerned ministries sharing our views in this regard.”
As regards the specific matter of cotton seed and technology, mutual agreed bilateral
arrangements associated with technology licensing have been in place for over a decade. Such
arrangements have from time-to-time reflected the prevailing environment in the country
including seed-price controls which have been in place in some States. Trait fees for cotton
technologies in India are amongst the lowest in the world and comprise only about 1
-2% of the total cost of cultivation for farmers, while the benefits have been transformational.
The local cotton seed companies who are the licensees of the technology also prospered
during this period by receiving a share of the trait fee being collected from the farmers.
Speaking on the issue Dr. Paresh Verma, Head of Management Committee, ABLE AG said,
“As was emphasized by the Prime Minister during his recent trip to US, respect for Intellectual
Property Rights in agriculture would be critical in India as it would lead to increased
investments in R&D for developing innovative solutions to increase productivity and farmers’
income. Any policy that brings in adhocism related to potential return on investment will
adversely influence research investment decisions of technology development companies.”
With introduction of Bt cotton in India since 2002, today India is world’s 2nd largest exporter
of cotton from 2nd largest importer at the time of technology introduction. Cotton is a global
commodity and global competitiveness is key for Indian farmers to compete in the world
market. India produces cotton worth $10 billion annually of which $2.5 billion is exported.
The domestic market consumes a value of $7.5 billion feeding a large part of it to the textile
sector which capture value through further export. 7 million farmers are directly benefited
from the cotton; as many as 20 million gets ancillary support in the form of farm labour.
According to UK-based research group - PG Economics, higher cotton production and
insecticide savings from Bt cotton seeds helped India’s cotton farmers earn Rs. 42,300 crore
of additional income between 2002 and 2010.Other studies including the one done by the
Council for Social Development (CSD), titled, ‘Socio-Economic Impact Assessment of Bt Cotton
in India,’ have found that higher returns from Bt cotton cultivation has empowered the
farmers and landless labourers to increase their expenditure on improving their livelihood
status. On an average 85 per cent of farmers and landless labourers invested in better quality
education for their children, 77 per cent reported intake of high value and nutritious food, 70
per cent spent more on recreation and social functions, 75 per cent on health of their family
members and 64 per cent on health of livestock. The increased expenditure has in turn
improved their livelihood status and led to their overall family development in the last
decade.
Indian farmers’ choice to plant hybrid cotton seeds with insect-protection Bt cotton
technologies on over 90 per cent of cotton acres, and increased cotton production, is
testament to the value created by better seeds, technologies and farming practices, when
compared with the alternative of seed and insecticide sprays.
ABLE-AG and its member companies operate with the best interest of farmers in mind. The
association is of the view that market circumstances should define seed value and commercial
matters involving licensing of innovative technologies should be free of Government
interference. In this light, the current order should be withdrawn or modified by the
Government since it may arbitrarily deprive technology providers of existing and future
technologies, which will impact their ability to make informed investments to develop and
introduce new technologies. As much as this Order suggests that it has been made in farmer
interest, impeding access to technologies for Indian farmers, while their counterparts across
the world benefit from the same, contradicts the stated purpose.
About ABLE-AG
ABLE-AG- Association of Biotech Led Enterprises (Agriculture Focus Group) is an association
of 13 leading technology provider, seed and biotechnology companies focused on research
and development of innovative agriculture, Biotechnology products for the benefit of
farmers, consumers and the nation.
ABLE-AG aims to accelerate the pace of agricultural growth in India by enabling strategic
alliances between researchers, the Government and the global biotech industry to increase
crop productivity, help meet domestic food security, and contribute to the inclusive growth.
For further details please contact:
Ridhima Sahni/Aanchal Wadhwa
Six Degrees PR
9810289995/9717726687
ridhimas@sixdegresspr.co.in/aanchalw@sixdegreespr.co.in
Aditee Dey Dutta
ABLE AG
Mobile No: 9711306389
Email id: aditeed@ableindia.org.in