By Alan White
Farmers in India have lately been succumbing to suicide at an alarming rate, due to a combination of overindebtedness and crop failures. A compelling paper presented at this week’s International Association of Consumer Law Conference laid part of the blame on regulatory failures that permitted Monsanto Corporation to sell genetically modified cotton seed (Bt Cotton) representing it as disease resistant and high-yielding, when in fact it turned out to be neither. The paper, presented by Avni Chari, student at NALSAR University Law School (our conference host) is entitled Multinational Corporation’s Ascendancy over the Seed Industry, and was presented with a related paper by student Namrata Sharma entitled Agriculturalist Debtors: A Vulnerable Consumer Group.
Cotton farmers in Andra Pradesh and Tamil Nadu have defaulted on bank debt, and then become further indebted to illegal moneylenders. According to Ms. Chari’s paper, their precarious situation was aggravated as a result of the aggressive marketing and subsequent disappointing results of Bt Cotton seed. Like many genetically modified varieties, Bt Cotton is sterile, so that farmers cannot set aside seed from the current crop for the next planting season, but must purchase the expensive seed each and every season. Thus Indian farmers are being converted from producers of seed to consumers. The Indian regulator was apparently persuaded to permit large-scale marketing and distribution of Bt Cotton seed at a time when many other countries were still awaiting further testing. The farmers were left with debts incurred to purchase the seed and to invest in additional irrigation required to grow Bt Cotton, and crop failures leaving them unable to repay the debts.
The Indian government has come up with several responses to the wider problems, including issuance by the Royal Bank of India of credit cards to all farmers, criminal prosecutions of moneylenders, and exploring bank branching at post offices to make credit available in rural areas.
My astute friend Christine Riefa points out that strictly speaking cotton farmers are not consumers, as defined by most consumer protection statutes aimed at deceptive marketing practices. Be that as it may, this paper highlights a need for multinational regulation and redress to respond to Multinational misconduct.