The Hindu Business Line : AP Govt moves MRTPC against Monsanto on Bt cotton royalty

THE Andhra Pradesh Government on Monday moved the Monopolies and Restrictive Trade Practices Commission (MRTPC) against Mahyco-Monsanto Biotechnology Company on the "exorbitant" royalty being collected by it for Bt cotton.

The Government move follows complaints from farmers and people's representatives.

"Anticipating the Andhra Pradesh Government move, Monsanto has filed a caveat petition. The case is scheduled to be heard on January 10," said a Government official.

There are a few points that the Andhra Pradesh Government is objecting to regarding the pricing policy of Monsanto.

For every 450 gm of seeds sold, Monsanto charges Rs 1,200 as `trait' charges (which is a form of royalty charges) from its Indian licensees, whereas it charges Rs 108 from its licensees in the US, according to the Andhra Pradesh Government.

"There is a massive difference in the royalty charges that Monsanto imposes in India and in the US for similar products," said the official.

"Bt cottonseeds are sold at an average price of Rs 1,850 per 450 gm to the farmers in Andhra Pradesh as 450 gm is the considered usage level per acre while selling.

In the last three years, cotton farmers in Andhra PradeshAP bought Bt cottonseeds worth Rs 130 crore.

Of this, Rs 78 crore went to Monsanto (as royalty).

Our Hyderabad Bureau reports: Meamwhile, Mahyco Monsanto Biotech (India) Limited has said its pricing philosophy in the agriculture industry is based on sharing the value that products and technology deliver to farmers.

Reacting to a report (Business Line, Dec. 29) on Andhra Pradesh's plan to move MRTPC over the Bt royalty issue, a company statement said there were several factors that determined the price. Benefits in the form of better yields, application flexibility and savings were some of the factors that governed the price.

The technology fee was used to support current products in a market and to fund research. Besides, the fee was shared with the retail technology channel, seed partners, and Monsanto shareholders.