(Jayachandran/Mint)
(Jayachandran/Mint)

Opinion | PepsiCo farmer lawsuit is a misguided action

PepsiCo may be concerned about competitors using its patented potato variety, but targeting the weakest element in the chain, the small farmer, may not be the best remedy

There is no crop which is more egalitarian than the potato. From overpriced wedges to the plates of the poor, the humble potato is so omnipresent that any controversy surrounding it evokes sharp reactions. India recently landed in the midst of one such controversy after PepsiCo India sued at least four farmers from Gujarat for using its proprietary FC5 variety—which goes into making Lay’s chips—without the company’s consent. The case is important for several reasons. For the first time in India, a group of farmers has been sued over intellectual property rights violation. The stakes are high since it will set a precedent, but to begin with, PepsiCo seems to have filed the case with an inaccurate understanding of existing Indian laws. The Protection of Plant Varieties and Farmers’ Rights Act, 2001, under which PepsiCo’s potato variety was registered in 2016, allows farmers to plant, grow, exchange and sell patent-protected crops, including seeds, and only bars them from selling it as “branded seed". PepsiCo may be concerned that its competition is using the protected varieties grown by farmers to make chips, but it perhaps made the mistake of targeting the weakest element in the chain, the small farmer. By seeking damages of over 1 crore from each of them—a sum they are unlikely to earn even in a lifetime—it may have committed a cardinal sin, that too in the middle of a general election.

There’s more. To gather evidence, the company carried out a sting operation by hiring detective agencies to pose as buyers who lured growers by offering them a higher price, farmer groups have alleged. According to them, PepsiCo should have collected evidence to nail its competitor, instead of suing farmers. Farm activists have also argued that while the potato variety was introduced in India in 2011, it was only registered five years later in 2016; therefore, it is natural that it spread among farmers who are not under any contractual arrangement with the company. After a social media campaign took off asking consumers to boycott PepsiCo products, the expected has happened—the multinational giant offered to amicably settle the matter during a hearing in a commercial court in Ahmedabad last week, and the Gujarat government has pledged support to the farmers.

In this din, something crucial is ignored—the reality that Indian farmers are keen to test and adopt new crop varieties even at the risk of legal action. Think of farmers in Maharashtra growing illegal herbicide-tolerant cotton to save on labour costs or recent evidence of farmers in Haryana growing genetically modified brinjal. In Gujarat, farmers have been cultivating genetically modified cotton since before it was approved by the environment ministry. India has deliberately chosen a patent law that allows its farmers considerable freedom to use patented varieties. As one researcher described it, the Indian law can be thought of as a patent-lite version, compared to strong IPR laws in the US. In such a situation, India has to invest more in public research since it is only natural that private companies are not keen to bring new technology. The controversy surrounding Monstanto’s Bt cotton—and consequently India’s agriculture ministry regulating royalties payable to the company—is a case in point. The way to reduce corporate dominance over agriculture is by increasing investments in public research, not by arm-twisting or surrendering to farmer-friendly optics.

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