Bt cotton: Karnataka HC removes stay on Centre's seed price control order

The high court of Karnataka has removed its earlier interim stay on implementing a part of the order issued last December by the central government to cap the price of genetically modified (termed 'Bt') cotton seed.

Mahyco Monsanto Biotech (MMBL), a joint venture of multinational seeds company Monsanto, has also challenged the order at the high court in this city. After the order, Monsanto had said it would have to ‘re-evaluate’ its businesses in this country. MMBL has sub-licensed Bt cotton seed technology since 2002 to various domestic seed companies.

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Removing the Karnataka HC stay had been urged by the Union government, supported by the National Seed Association of India and some others. The interim stay was in March, on the portion empowering the central government to regulate the ‘trait value’ (licence fee) entered into between two parties, on the ground that it was based on a mutual agreement. It had not interfered with that part of the order which fixed a uniform maximum retail price (MRP) of all Bt cotton seeds.

The stay was granted on a petition filed by the Association of Biotech-Led Enterprises-Agriculture (ABLE-AG),  Namdhari Seeds and some others. "We are reviewing the order and considering our options,” sated Shivendra Bajaj, executive director, ABLE-AG, on Wednesday.

After the Union ministry of agriculture had notified the Cotton Seeds Price (Control) Order, a committee was formed to determine various cost components and fix the MRP, along with seed value and trait value. The order lowered the trait value or licence fee that companies like MMBL could charge from seed companies by 70 per cent. And, the MRP for seed companies by 25 per cent.

The government order came against the backdrop of disputes wherein some licensees refused to honour their commitments to pay MMBL, after collecting these amounts from cotton farmers in last year's kharif season.