In a twist to the ongoing tussle between Gujarat’s potato growers and PepsiCo India Holdings Pvt Ltd, the multinational firm has offered an out-of-court settlement, but with conditions.
During the hearing of the matter at the City Civil Court in Ahmedabad on Friday, the counsel appearing for PepsiCo expressed a willingness for an out-of-court settlement and put and end to the case.
A PepsiCo spokesperson, in a statement, said: “PepsiCo India has proposed to amicably settle with people, who were unlawfully using seeds of its registered variety. PepsiCo has also proposed that they may become a part of its collaborative potato-farming programme. This programme gives them access to higher yields, enhanced quality, training in best-in-class practices and better prices. In case they do not wish to join this programme, they can simply sign an agreement and grow other available varieties of potatoes....”
The statement added: “The company was compelled to take the judicial recourse as a last resort to safeguard the larger interest of thousands of farmers that are engaged with its collaborative potato- farming programme. PepsiCo India remains deeply committed to resolving the matter and ensuring adoption of best farming practices.”
Read: Farmers in a fizz as PepsiCo files suit over potato IPR violation
However, it is still not clear if the farmers are willing to accept an out-of-court settlement anytime soon. “A decision on the out-of-court settlement will be taken after consultation with farmers,” said the counsel representing the farmers. The farmers have sought time to file written responses and their objections. The next hearing is on June 12.
PepsiCo had filed lawsuits against four farmers from Vadali taluka of Sabarkantha district in North Gujarat for “estimated damages” of about ₹1 crore to the company through illegal production of its registered variety of potato.
The farmers were allegedly growing a variety of potato namely FL 2027, also called FC5, on which PepsiCo claimed exclusive rights by virtue of a Plant Variety Certificate (PVC). The variety is used to make the company's chips product, Lay’s.
Assured prices
Farmers, however, claimed that the cost of cultivating the “processing” variety of potato or the variety being used to make chips is almost double, with more and costly inputs, including fertilisers, weedicides etc.
“The seed has to be purchased from the company itself at the price they set. In some cases, prices are as high as ₹1,350 per 50 kg, while for the normal potato, the seed cost is about ₹700. Farmers go for processing potato cultivation, purely because of the assured market and prices. Due to fluctuating and uncertain price scenario in the open market, farmers are compelled to go for it,” said Jambhai Patel, a farmer and potato trader in Deesa in Banaskantha.
One of the farmers facing the PepsiCo lawsuit added: “The crop cycle of processing a variety of potato is longer than that of normal potato. And if the potato size is smaller than the prescribed 40-45 mm diameter, it gets rejected. If we get a good price for our regular potato, farmers wouldn’t go for the processing variety.”
Till the next hearing on June 12, the earlier order of the court will remain in force. The Commercial Court had last week stayed farmers from growing and selling the said variety of potato.
On Friday, farmers’ group Rashtriya Kisan Parishad, led by Pravin Togadia, has called for strict action against the company and sought the government’s intervention.
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