Financial Daily from THE HINDU group of publications
Wednesday, May 31, 2006
Financial Daily from THE HINDU group of publications Wednesday, May 31, 2006 |
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Agri-Biz & Commodities
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Cotton Authority to impose price control on seeds questioned G. Chandrashekhar
Mumbai , May 30 The objective may be laudable; but the means adopted are not. Worse, it could set a bad precedent that would encourage politicians and governments to squeeze the private sector to cover up their own inadequacies. Even as the highest court of the country is in the process of hearing the appeal filed by Mahyco-Monsanto Biotech India Ltd against the order of the Monopolies and Restrictive Trade Practices (MRTP) Commission in the matter of fixing a fair price for Bt cottonseed — a genetically modified cottonseed variety — the State Governments have begun to take precipitate action.
Bt cottonseed
In its wisdom, the Andhra Pradesh Government has already issued an order mandating seed companies not to sell Bt cottonseed above Rs 750 a packet. In doing this, the State has apparently relied on the order issued by MRTP Commission last month. However, the order of May 11 has granted time till June 10 for announcing a new technology fee. Under the circumstances, representatives of the seed industry have begun to question the very authority of the government to impose price restriction. The seed industry is going through a critical time as the southwest monsoon has already hit the southern coast and is progressing well. Farmers have to access inputs including seeds for planting. A clear and unambiguous decision on pricing that would be fair to growers and seed producers is imperative.
Potential to distort
Uncertainty in the matter of pricing of Bollgard Bt cottonseed, in some parts of the country at this juncture, can potentially lead to distortion of the market and encourage unauthorised activities. Interestingly, the regulatory body for biotech crops has remained silent on the issue. Perhaps its duty does not go beyond granting approval. The inability of that body to curb unauthorised planting of biotech crops is known. It is in everyone's interest to put an end to this unseemly controversy. It may be instructive to remember that sustained agricultural development does not take place through State diktats. For instance, seed companies can refuse to sell in places where State-determined price controls are in vogue. Farmers would be the eventual losers. Agriculture is the country's largest private sector enterprise. Given the small and marginal nature of farms, growers need protection. Yet, successive governments have shown scant regard for essentials such as strengthening input delivery system, consolidating fragmented landholding, expanding irrigation, and building rural infrastructure. Public investment in agriculture has been declining. Despite several odds, cotton output in the last three years has demonstrated strong growth. This needs to be sustained. It would be most unfortunate if the market report that large commercial interests — for and against biotech products — are fighting a proxy war using various fora is true.
More Stories on : Cotton | Seeds | Bio-tech & Genetics
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