Govt might revise licence fee of Bt cotton seed for 2018-19 crop season

After a gap of two years, the central government might revise the ‘trait value’ (licence fee) of genetically modified (Bt) cotton seed for the 2018-19 crop season.

The current price is Rs 800 for a 450g packet; this might also be changed. Of this, Rs 49 is the ‘trait fee’ and this could be cut by Rs 20-25. The Centre sets both rates.

The trait fee is what seed companies have to pay to the licence holder. In this case it is, global giant Monsanto’s joint venture partner in this country, Mahyco Monsanto Biotech (MMBL).

For the 2017-18 season, the Centre had retained the trait value at Rs 49, which included all taxes. It had also kept the price of Bt cotton seed unchanged at Rs 800 per 450g. 
 

Bt cotton seed prices were first lowered in 2016, by a panel constituted by the Centre under the Cotton Seeds Price Control Order of December 2015. Brought down from Rs 830-1,030 earlier; trait value was lowered about 70 per cent, from Rs 163 a packet.

The move was followed by a guideline issued in May 2016, which capped the trait value at 10 per cent of the seed sale price and thereafter lowered it periodically. This was much criticised by multinational seed companies. Monsanto said it would “re-evaluate” all its business in the country; it took the biggest hit. 

It had also petitioned against the order at the high court in Delhi. MMBL has sub-licensed Bt cotton seed technology since 2002 to 50-odd domestic companies. First sub-licensing BG-1 technology, which went off-patent in 2006. It now sub-licenses BG-2. Seeds produced using this technology occupy 95 per cent of the Indian cotton market. 

A third technology, BG-3, is in the pipeline but commercial use has not yet been approved. 

Domestic seed companies alleged MMBL collected Rs 5.3 billion annually as trait value and since 2002 had taken Rs 70 billion as licence fee. The Indian Bt seed market is worth at least Rs 35 billion a year.

The issue divided National Seed Association of India, with multinational companies and some like-minded Indian ones forming the Federation of Seed Industry Association.