New Delhi: In a move that will benefit over eight million cotton growers in India, the agriculture ministry late on Monday slashed the price of genetically modified Bt cotton seeds to Rs740 per packet from Rs800 per packet earlier.

The ministry also reduced the trait or royalty fees payable by domestic firms to technology developer Mahyco Monsanto Biotech (India) Pvt. Ltd to Rs39 per packet from Rs49 earlier. A packet of Bollgard II Bt cotton seeds weighs 450g.

The new prices will come into effect from the forthcoming kharif crop season beginning in June. Last week, Mint reported on the likely government move to offer some respite to cotton farmers battered by repeated pest attacks and crop losses.

The domestic seed industry pegs the losses arising out of the price cut at around Rs300 crore, as 50 million cotton seed packets are usually sold in a year. Falling margins in cotton seed production will definitely impact seed supply and availability for farmers, said Kalyan Goswami, director general of industry lobby National Seed Association of India.

In March 2016, the agriculture ministry, on the recommendation of a nine-member panel, slashed prices to Rs800 per packet, compared with Rs830-1,000 charged earlier—and cut royalty fees sharply by over 70%. Last year, prices were kept unchanged.

“The latest price cut and reduction in royalty fees is a huge setback for responsible research-based seed companies who will be demotivated to spend on R&D," said Ashwani Yadav, executive director of Federation of Seed Industries of India, a lobby of research-focused seed firms.

India approved genetically modified Bt cotton for commercial cultivation in 2002. Following the introduction of Bt cotton and its efficacy in resisting bollworm pest attacks, India became a leading exporter of cotton globally. However, in recent years, Bt cotton fields have seen repeated pest attacks and crop losses—in Punjab in 2015 and in Maharashtra last year.

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