Multinational seed technology companies are showing no interest in submitting applications to introduce new technologies that can help crops overcome troublesome pests and insects. The lack of interest is despite five months having passed after two warring Indian seed associations came together.

In July this year, the Federation of Seed Industry of India (FSII) and the National Seeds Association of India (NSAI) buried their 16-year-old hatchet to end their disputes over trait value of seeds and licensing of seed technology - mainly Bacillus thuringiensis (Bt) cotton - that had been raging since 2005.

The associations were at loggerheads since FSII supported patents for genetically modified (GM) seeds, while the NSAI had questioned patents for GM technology.

Unclear picture

In July, the FSII had reached out to the multinational seed technology firms, particularly Bayer AG, to submit applications afresh. The German firm had accepted its request and told the seed body that the issue was being discussed at its headquarters.

When contacted, M Ramasami, Chairman-cum-Managing Director, Rasi Seeds (P) Ltd, told BusinessLine that FSII -headed by him - had not heard anything official from any of the multinational firms. “The picture on the submission of applications is not clear,” he said.

In August, the Rasi Seeds CMD said the FSII planned to meet government authorities to ensure a smooth process for filing of applications to introduce new crop technologies.

Industry sources said multinational seed technology firms were concerned over three issues and would like them to be sorted out before they can consider filing applications for the new technologies.

Three concerns

“One is the Indian government fixing prices for genetically-modified and Bt cotton. There is also no clarity over patents and intellectual property rights,” an insider said on condition of anonymity.

While the Indian government is now determining the price for Bt cotton, the issue over patents and intellectual property rights, a bread and butter issue for multinational firms, is hanging fire.

In 2016, the Centre cut the royalty by over 70 per cent from ₹163 per 450 gm to ₹43, resulting in the prices of Bt cotton coming down. When Bt cotton was introduced in the country, seed companies paid a high royalty resulting in farmers having to pay a higher price for the seeds. This led to a demand for government intervention, resulting in the Centre beginning to fix the royalty percentage.

As a result, multinational seed technology providers, including Bayer AG which had taken over another seed giant Monsanto in 2019, withdrew their applications seeking approval for new technologies such as Bollgard Roundup Ready Flex cotton. The applications were withdrawn in 2018.

20% royalty offer

During discussions with multinational seed firms, Indian seed firms, after the warring factions came together, offered to pay a maximum royalty of 20 per cent, subject to seeds acceptance and sales.

The other issue of patents and IPR resulted in Monsanto (now owned by Bayer) being dragged to the court and the Ministry of Agriculture issuing orders for antitrust investigations against the multinational. The dispute was resolved out-of-the-court earlier this year.

But Monsanto claimed that once Indian seed firms stopped paying royalty in 2005, it incurred losses to the tune of millions of dollars.

Right from the time, FSII, which has 45 members, and NSAI, comprising 400 indigenous members, announced that they were burying their differences to come together, industry sources had said “it is a marriage that is doomed to fail”.

The sources said the current status of not a single firm coming to submit its application is proof that the coming together of the warring factions is not serving the purpose.

When contacted, a multinational seed firm said it would not want to comment on the issue.

Confined to cotton

Ramasami said India’s seed technology development, particularly to get GM crops, has remained confined to cotton. “It is not easy to develop crop technology. The Centre has to encourage the development of the next technology,” he said.

Lamenting that India has not got the second technology for nearly two decades now, he said GM cotton introduced earlier had developed resistance to pests. “Seed development is a complicated issue. Our firms do not have the required funds for research and development,” he said.

In particular, the pink bollworm has developed natural resistance without introduction of new technology and now spread even to North India, where its presence had not been sighted until last year.

Last nod was in 2006

Industry sources said the spread of the virus to Punjab cotton areas is a matter of concerns. “Given the violent nature of the farmers there, the seed industry is unable to decide on how to operate,” the insider said.

Till now, India has approved commercial sale of genetically modified seeds in cotton only till now. The last approval given by the Genetic Engineering and Appraisal Committee, the authority approving genetically modified organisms technology, was in 2006 for Bollgard II cotton.

In August, a senior executive of a multinational seed technology firm told BusinessLine that they were keen to know what the ₹20,000 Indian seed industry vision was before filing applications for new technology seeds.

The executive said while they were looking at ways to reintroduce new technologies, they were keen to know how the Indian government looked at the coming together of the warring seed factions.

The executive said the firms had an “idea in framework” on the royalty issue, but refused to elaborate.