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13 March 2019Big Pharma

India cuts Monsanto GM cotton seed royalties by almost half

India’s government has cut the royalties its local seed companies and farmers pay to  Monsanto by almost 50%.

This is the third time the government has reduced the royalties in four years. Indian seed companies will now pay 20 Indian rupees ($0.29) in royalties for a packet of 450 grams as opposed to 39 rupees—a decrease of 49%.

According to  The Times of India, the move could benefit 8 million cotton farmers across the country.

But Ram Kaundinya, director general of the Federation of Seed Industry of India, told  Reuters the decision could cause other foreign seed companies to further scale back investment in the sector.

“The decision comes at a time when India's cotton output is falling and needs a breakthrough to help maintain its leading position in the global cotton market,” Kaundinya said.

Monsanto’s GM cotton seed, the only lab-altered crop allowed in India, was first approved in 2003.

It now dominates 90% of India’s cotton acreage. The crop was also fundamental in transforming the country into the world’s top producer and second-largest exporter of the fibre.

The reduction comes after The National Seed Association of India and a political organisation,  Swadeshi Jagaran Manch (SJM), demanded the government take action on royalty fees.

On March 1, Ashwani Kumar, the co-convenor of SJM, wrote to the government saying Monsanto was doing nothing to solve the problem of a cotton plant pest.

"As you are aware, farmers are compelled to use expensive pesticides to control the Pink Bollworm and are facing severe losses. The act of reducing the sale price of cotton seeds would give some relief to the farmers," he said in his letter.

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