Corruption Allegations Leave Bitter Taste in India’s Coke

It’s been called a “Ghandian nonviolent struggle.” Countless protests involving thousands of people have been held throughout the country. Hundreds of people have gone on hunger strikes. Dozens have been arrested, including children. The standoff has received worldwide attention, turning residents of impoverished villages into international causes célèbres.

India vs. Coke is a classic conflict between a powerful transnational corporation trying to expand its worldwide reach, and a developing nation working to preserve its sovereignty against the forces of globalisation.

The struggle has reached numerous climaxes. Perhaps the biggest came when the small southwestern state of Kerala ordered Coke to shut down its bottling plant in Plachimada, a remote village of about 9,000 on the Malabar Coast. For years, residents had complained the 561,000-litre-per-day factory was sucking drinking-water wells dry. Waste from the facility, among the largest of Coke’s 50 in India, was also blamed for polluting groundwater and soil.

Officials finally closed the plant in August 2005 after Coke failed to adequately explain why dried sludge waste it was donating to farmers to use as fertiliser contained toxic heavy metals. Cadmium from the sludge, as well as from Coke’s wastewater discharge, has been blamed for contaminating groundwater in the area.

The Kerala State Pollution Control Board also cited Coke for failing to comply with orders to treat its wastewater and provide piped water to residents affected by its aquifer extractions.[1]

''The fact of the matter is that that water from underground sources is being pumped out free, bottled and sold to our people to make millions for cola companies while destroying the environment and damaging public health,” said Veerendrakumar, a member of the Indian Parliament and editor of the newspaper Mathrubhumi.[2]

Corruption may be one reason why Coke was able to defy controversy and keep the Plachimada plant open for so long – and cause more pollution in the process. About a week before plant was ordered shut, Kerala’s Vigilance and Anti-Corruption Bureau raided the homes of former Pollution Board member K.V. Indulal in three cities in Kerala.

The Bureau opened an investigation into whether Indulal was taking bribes when, in August 2003, he declared groundwater pollution near the Plachimada plant to be “not beyond tolerable limits.” He was serving as the Pollution Board’s secretary at the time.

One month earlier, however, the BBC program Face the Facts reported the sludge Coke was giving to farmers contained cadmium and lead, and that the sludge was worthless as a fertiliser. The BBC quoted a UK toxicology expert warning of the “devastating consequences for those living near areas where this waste has been dumped and for the thousands who depend on crops produced in these fields.”

Coke disagreed. "It's good for crops," said the company’s vice president in India, Sunil Gupta. “It is absolutely safe and we have never had any complaints.”

The Pollution Board ordered Coke to stop giving the sludge to farmers. But Indulal unexpectedly overruled the decision.

Coke watchdog groups prompted the corruption investigation after accusing Indulal of “suppressing evidence and taking bribes in order to favour the Coca-Cola company.”[3],[4],[5]

Given a two-year reprieve by Indulal, the Coke plant continued to draw up to 1.5 million litres of water a day from aquifers – to manufacture soft drinks, and to clean bottles and equipment. The pumping exacerbated drought conditions that forced villagers to walk long distances with pails and buckets in search of water for drinking, cooking, farming and washing.

Locals responded by blocking a truck attempting to deliver water to the bottling plant. After women came to fill their pots with the commandeered water, police arrested 44 people, including 7 children. “The company has been stealing precious drinking water from deep down the earth and our wells have all gone dry,” said Mylamma, an elderly tribal woman.[6]

Still more problems were in the offing. In July 2005, lab tests by the New Delhi-based Center for Science and Environment showed that 11 Coke and Pepsi products contained pesticide levels 24 times higher than Indian and EU standards. The group found a “cocktail of between three to five different pesticides in all samples." A month later, Kerala outright banned the production and sale of Coke and Pepsi in the state.[7],[8]

In a mock protest, farmers began spraying Coke onto their crops, saying it was cheaper than using pesticides themselves.[9]

Coke and Pepsi has been also been banned in government and educational institutions in the states of Andhra Pradesh, Chattisgarh, Delhi, Gujarat, Karnataka, Madhya Pradesh and Rajasthan.

Kerala’s High Court has since overturned the ban but officials there have ignored the ruling. Meanwhile, India’s Supreme Court has ordered Coke and Pepsi to place warning labels on their products and to disclose the ingredients in their products. If the companies refuse, the court could ban the drinks from the entire country.

Coke was previously ejected from India in 1977 after refusing to reveal its formula and reduce its equity stake in Indian operations.[10]

Local advocates have praised government officials for working to protect their health and livelihoods.

“We welcome the actions by the state agencies in Kerala to stop…the Coca-Cola company," said Amit Srivastava, coordinator of the India Resource Center. "These actions are major victories for the community of Plachimada, which has all along been demanding that the state do what it is supposed to do – safeguard the interests of the community."[11]

Mark Worth is a researcher based in Berlin who writes about water and food safety issues for NGOs in Europe and the United States.

[1] “Community succeeds in shutting Indian Coke bottling plant.” Environment News Service, 22 August 2005.

[2] Rajeev, D. “India: Everything gets worse with Coca-Cola.” Inter Press Service, 22 August 2005.

[3] Environment News Service, op. cit.

[4] Rajeev, op. cit.

[5] “Coca-Cola's 'toxic' India fertiliser.” BBC News, July 25, 2003.

[6] Surendranath, C. “Coke vs People: The heat is on in Plachimada.” India Resource Center, 14 April 2004.

[7] “Kerala throws out Coca-Cola and Pepsi.” India Resource Center, 9 August 2006.

[8] Stanford, Duane D. “Coke’s PR offensive in India pays off.” Atlanta Journal-Constitution, 3 December 2006.

[9] Jeffrey, Paul. “Wells run dry: Coke faces thirsty opponents in India.” National Catholic Reporter, 24 March 2006.

[10] Tripathi, Salil. “A disingenuous campaign against U.S. colas.” International Herald Tribune, 24 August 2006

[11] Environment News Service, op. cit.



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