Modi govt abolishes trait fee on Bt cotton seed time of COVID-19; enriches seed companies at farmers’ expense

From notifying new domicile and job reservation rules for Jammu & Kashmir to playing “nationalist” seed companies against a multinational, the outbreak of COVID-19 has not restrained the government from pushing its ideological agenda.

In a notification issued on March 24, the ministry of agriculture abolished the trait fee on Bollgard II Bt cottonseed payable to the Bayer group following its acquisition of the American agricultural biotechnology company, Monsanto, which was completed in September last year.

A fee of Rs 20 was included in the maximum retail price of Rs 730 per pack of 450 grams of Bollgard II Bt cottonseed last year. This year, the trait fee has been abolished but the selling price is unchanged. This means, 40-odd seed companies have been enriched at the expense of farmers and the multinational which provides the genetically-modified (GM) insecticidal Bt trait that is toxic to worms that bore into cotton bolls and damage them.

Currently, India plants about 11 million hectares with Bt cotton. About 50 million packets of Bt cottonseed are sold every year. There are 40 companies that are franchisees of Bayer. They stand to gain about Rs 100 crore from farmers. Bayer will get nothing for its proprietary technology.

According to an industry source, the patent on Bollgard II will expire in 2022. But the National Seed Association of India (NSAI) which has been pushing for abolition of trait fees believes the patent has expired, the same source said.

The abolition of trait fee or royalty would not have mattered if Indian state-funded research institutions were at the forefront of agricultural innovation. They have done excellent work in wheat, rice and sugarcane breeding and have given India blockbuster varieties that have brought billions of export dollars over time. But they are lagging (GM or agricultural biotechnology. And even where they have achieved success like in GM mustard, political opposition has prevented commercial application.

The abolition of royalty will have a chilling effect and deny farmers access to much needed technology for which Maharashtra’s cotton farmers, affiliated to the Shetkari Sanghatana, launched an agitation at Akola in June last year. They planted unapproved genetically-modified herbicide tolerant cotton in the glare of TV cameras and in defiance of the law. About two dozen farmers in the state lent their farms for the illegal planting that month. They said that employing manual labour to do weeding was too expensive. The use of HTBt cottonseed reduced the cost of weeding – and of cotton cultivation.

“While it is disappointing to see the full elimination of trait fees we will in collaboration with other technology providers continue to highlight the need to maintain a reasonable level of trait fees,” the Bayer spokesperson said in a statement. “This is essential to support stewardship, maintaining longevity and at the same time investing in future technologies; factors that are critical to preserve global competitiveness and livelihoods of millions of smallholder cotton farmers across India,” the spokesperson added.

“I am not so happy with the abolition of trait fees,” M. Ramasami, the founder and chairman of Salem, Tamil Nadu-based Rasi Seeds said, though his company stands to gain. He is also the president of the Federation of Seed Industry of India (FSII), a breakaway faction of NSAI. If the technology provider does not get royalty who will ensure quality control, Ramasami asked. Seed companies which have little regard for quality will introgress the bollworm-killing Bt trait into their seeds. If their seeds don’t have adequate potency, bollworms will develop resistance, and Indian farmers will lose the benefit of a technology that has saved them from the bollworm scourge for close to 20 years, Ramasami said.

Ramasami says his company is the largest seller of Bt cottonseed with a third of the market share. It is itself developing Bt cotton technology. It has been at it for six years. It takes about 15 years to perfect the technology and obtain regulatory approval. If technology developers are unsure of recouping their investment and profiting from it, R&D activity will suffer. Private companies will not develop proprietary agricultural innovations in the country nor import it, he said.

In his address to the Indian Economic Association last December, NITI Aayog Member Ramesh Chand had said the countries that embraced GM technology have gained an advantage in productivity and cost. He gave the examples of soybean and maize where GM technology has boosted US and Argentine yields. In soybean, their latest five-year average is 3,236 kg/ha and 2,935 kg/ha respectively while India’s is lagging at 973 kg/ha. In maize, the five-year average US yield is 10,655 kg/ha. That of Argentina is 7,154 kg/ha. India’s is 2,702 kg/ha. With such low productivity levels, India cannot compete in international markets.

Chand said since the 1970s, agricultural growth has moved in step with real or inflation-adjusted prices of agricultural produce. Prices have driven output growth rather than the other way around. The challenge, he said, was to sustain agricultural growth while keeping food price inflation within acceptable limits and incentivise farmers to produce more without hurting consumers. It is not just growth but efficient growth that is needed. This requires improved technology, innovative farming, reduced wastage of inputs and output, and better farm management practices.

Chand said in the absence of R&D of global standard domestically, farmers must be given access to foreign technology. But private sector companies, including multinationals, hesitate to bring cutting-edge agricultural technology because of regulatory uncertainty.

The uncertainty got accentuated after the BJP government came to power in 2014. In 2016, then agriculture minister Radha Mohan Singh brought cottonseed within price control nationally. Till then, some states used to fix the maximum retail price. That year, he reduced the trait fee on Bollgard II Bt cottonseed from Rs 180 per pack (including taxes) to Rs 49, a reduction of 73 per cent. But the maximum retail price was fixed at Rs 800. For farmers in Maharashtra, this was a reduction of 4 per cent from the price of Rs 830 they paid the year before. If the entire trait fee reduction had been passed on to them, they should have paid Rs 699 per pack. Seed companies, who were the franchisees of Monsanto, gained Rs 131 per pack in that state.

Telangana farmers gained more as the MRP in that state was Rs 930 before Singh’s price control measure.

Since then, the maximum retail price of Bollgard II seed has been steadily reduced to Rs 730 even as the cost of hybrid seed production, being labour-intensive, has risen.

Singh also brought in a notification in May 2016 that would have rendered agricultural patents invalid but withdrew it after five days following an outcry, mainly from multinational corporations engaged in agricultural research But that notification had a chilling effect. It created uncertainty. Private companies were not sure that the government would not revisit the notification. Mahyco, a Maharashtra-based seed company which has technological collaboration with Monsanto, withdrew its application for approval of herbicide-tolerant Bt cotton (HTBt cotton), when it was on the verge of getting approved. But pirated HTBt cotton is planted extensively. An official committee has estimated that about 15 percent of India’s cotton acreage is planted with this version.

The NDA government’s stance against agricultural MNCs has been dictated by the Swadeshi Jagran Manch (SJM), which is part of the Sangh Parivar. But the SJM is also opposed to swadeshi agribiotechnology research even of the publicly-funded kind. It is believed to have prevailed over the government to now allow cultivation of the GM mustard hybrid DMH-11, developed by a team of Delhi University scientists led by the geneticist and former vice-chancellor of the university, Deepak Pental. DMH-11 was produced with funds from the National Dairy Development Board and the Department of Biotechnology. The apex regulator for GM technology – GEAC – recommended it for commercial cultivation in May 2017, but then Union Environment Minister Harsh Vardhan and his successor Prakash Javadekar have not given approval despite entreaties to the Prime Minister from the National Academy of Agricultural Science (NAAS). GM mustard has the potential to raise India’s mustard productivity and reduce its dependence on imported cooking oil.

Without GM technology India will also not be able to control fall armyworm which has begun to devastate India’s maize crop. It is also necessary to deal with borers in pigeon pea (arhar or tur), chickpea (chana) and brinjal.

Sadly, the Congress-led UPA government was also not supportive of GM technology. In 2010, then Union Environment Minister Ramesh Chand imposed a ban on the cultivation of Bt brinjal, even though GEAC had recommended it for commercial cultivation. Based on Indian bio-safety data, Bangladesh has been cultivating Bt brinjal since 2013.

India’s Mahyco had provided the technology free to Bangladesh Agricultural Research Institute (BARI). But then Prime Minister Manmohan Singh had publicly expressed his support for GM technology. While addressing the Indian Science Congress in Jammu in February 2014, he had said that India must not succumb to “unscientific prejudices” against GM crops. Chand had later said that nothing prevented the NDA government from lifting the ban he had imposed on Bt brinjal cultivation.

The Narendra Modi government’s anti-science attitude goes beyond agricultural biotechnology. It has been supporting organic agriculture which can serve niche consumers who are willing to pay more for agri-produce. It cannot affordably feed India’s growing population.

Paramparagat or traditional agriculture has been another obsession of the government. In her budget speech last year, Finance Minister Nirmala Sitharaman advocated Zero-Budget Natural Farming, even though there is no scientific evidence to validate its claims. Ironically, its initiator, Subhasb Palekar, whom this government has given a Padma award, has supported the planting of genetically-modified Bt cotton since desiseeds are not available in the quantities required.