Agriculture

Mahyco Monsanto Biotec expects fair business practices

Mahyco Monsanto Biotech (India) Private Limited reacts sharply on the reports that the government plans 70 percent reduction in the trait fees paid on Bt-cotton seeds.
Mahyco Monsanto Biotec expects fair business practices

Mahyco Monsanto Biotec today responded to varied reports in the public domain suggesting that the committee appointed under the Cotton Seed Price Control Order (CSPCO) of the Ministry of Agriculture & Farmers Welfare, plans to recommend imposition of a 70 percent reduction in the trait fees paid on Bt-cotton seeds.

In a statement issued, the Company said, “The government will encourage innovation, uphold fair business practices and provide predictability, which can benefit Indian farmers through access to relevant solutions.”

The MMB has challenged CSPCO’s attempt to fix trait fees. Such a drastic intervention overrides existing private bilateral commercial contracts, and undermines the overall operating environment in India, it said.

Shilpa Divekar Nirula, CEO – Monsanto India Region commented, “Over the past 19 years MMB’s single- minded focus has been to serve over 7 million cotton farmers in India. This has been reflected in benefits delivered by the technology, trait value prevalent in India, broad licensing of technology and extensive ongoing investments in stewardship for sustenance of technology.”

“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 Bt-cotton seeds, MMB will have no choice but to reevaluate every aspect of our position in India,” she warned.

“It is difficult for MMB to justify bringing new technologies into India in an environment where such arbitrary and innovation stifling government interventions make it impossible to recoup research and development investments focused on delivering extensive farmer benefits and where sanctity of contracts is absent.”

The Company claimed that the Bollgard® technologies continue to provide tremendous benefits to Indian farmers and the licensing model is in line with the relevant laws in India. Over the last decade, Bollgard® technologies have transformed India from being a net importer of cotton in 2002 to becoming the largest producer of cotton globally. It has also helped farmers increase cotton yields from 302 kg/hectare lint in 2002-03 to 552 kg/hectare lint in 2013-14 thereby helping generate an additional farm income of over Rs. 110,000 crores at current exchange rates and fuelling growth of the seed industry, textile value chain and job creation in these sectors.

The government’s intervention and any recommendation to reduce trait fees, if made, comes against the backdrop of a bilateral dispute where few licensees refused to honour their commitments to pay MMB, over Rs 450 crore after collecting these amounts from the cotton farmers in Kharif 2015. The MMB remains hopeful that with its intent to promote “Make in India” and commitment to improve “ease of doing business”, the government will encourage innovation, uphold fair business practices and provide predictability, which can benefit Indian farmers through access to relevant solutions.
 

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