The Karnataka High Court has vacated its earlier order of staying the Centre’s decision to slash Bt cotton seed prices.
In an interim order in March, the Karnataka High Court said that the Centre could not fix royalties as they are based on mutual agreements between different companies. It, however, allowed the government to fix the maximum sale price (MSP) of Bt cotton seeds for the benefit of farmers.
“It cannot be stated as arbitrary fixation at this stage since the documents produced on behalf of the government indicates that a committee was constituted to consider the price fixation and after providing opportunity to all the concerned parties, the price has been fixed, which has been notified,” the court stated in its order passed on Tuesday.
In March, the Union agriculture ministry notified the MSP rate along with a pan-India ceiling price of Bt cotton seeds at R800 a packet, down from R830-1,100. Earlier, a committee set up by the ministry had recommended the above rates. According to the December notification by the ministry, the decision to put Bt cotton seeds under price control was taken in view of farmers finding the seeds “to be highly priced” and the need to bring “uniformity” in their prices across the country.
Mahyco Monsanto Biotech (MMBL), a joint venture between Monsanto and Maharashtra-based Mahyco, had moved the Delhi High Court against the move, arguing that the price control order was “illegal and unconstitutional”. The case will come up for hearing next week.
Monsanto had recently threatened to re-evaluate its presence in India and hold back new technology if the plan to reduce the trait value is not rolled back. MMBL has sub-licensed Bt cotton seed technology since 2002 to various domestic seed companies. It is alleged that some of these companies have to pay MMBL some R450 crore after collecting the amount as trait value from the cotton farmers in Kharif 2015.
About 90% of the country’s cotton area of 11.8 million hectares (in the 2015-16 season) is under Bt cover. The country’s cotton production has risen manifold since the introduction of Bt seeds — from 13.6 million bales in 2002-03 to a projected 36.5 million bales in 2015-16.
