To eat or not to eat: Bt Brinjal

Kaushiki - February 11, 2010

The row over Bt Brinjal, a genetically modified version of the plant, provoked the government into imposing a moratorium on the commercial cultivation of the plant in India. The debate has revolved around issues of economic efficacy, human health, consumer choice and farmers’ rights. Jairam Ramesh, the Minister of State for Environment and Forests, made public his views on the subject, a gist of which is given below:

The Genetic Engineering Approvals Committee (GEAC) report recommended commercial cultivation of Bt Brinjal but qualified it by stating that since the issue has important policy implications at the national level, the government should take a final view on the matter.
Most of the state governments have expressed concern and have sought to ban the use of Bt Brinjal, or all GM crops.
Pesticides have harmful effect on human health and Bt technology is one way of reducing pesticide use. However, other routes such as non-pesticide pest management can be explored. For example, about 6 lakh farmers in Andhra Pradesh practice non-pesticide pest management over an area of about 20 lakh acres.
Safety is a concern since the kind of tests that have been done is not specific or stringent enough to detect toxins. Also, tests have only been carried out by the developers of the product, Maharashtra Hybrid Seeds Company Ltd. (Mahyco). (The results of the biosafety tests are available on the GEAC website).
There is no large-scale public funded biotechnology effort toward agriculture, which could compete with Mahyco. Monsanto is the main producer of Bt Brinjal, and Mahyco is owned to the extent of 26% by Monsanto.
While two government owned agricultural universities -- University of Agricultural Sciences, Dharwad and Tamil Nadu Agricultural University (TNAU), Coimbatore – have produced Bt Brinjal along with Mahyco, doubts have been raised about how Bt related research in these universities have been funded.
There are apprehensions that there will be diversity loss in the variety of Brinjal if Bt Brinjal is introduced, and this fear cannot be glossed over.
While Bt Cotton and Bt Brinjal are not comparable, the introduction of Bt Cotton in India has made India the second largest grower of cotton in the world. Over 90% of cotton farmers in India cultivate Bt Cotton. Many farmers support Bt Cotton on economic grounds but some did express doubts.
The Central Institute of Cotton Research, Nagpur has developed a Bt cotton variety (Bikaneri Nerma) whose seeds can be kept by farmers for planting during the next season. The Director of the Institute while expressing support for Bt Brinjal has mentioned that resistance development is a serious issue. Therefore, more tests that are well-designed, widely-accepted and independently conducted are necessary.
The GEAC process has been questioned by Dr P.M. Bhargava, the Supreme Court nominee on GEAC. He opposed the recommendation on the ground that all necessary tests had not been carried out before coming to a decision. The 2006 committee of the GEAC had asked for several tests to be conducted which were not taken into account by the second expert committee. All GEAC reports (including additional tests) of tests conducted with regard to Bt Brinjal are in the public domain.
There is some evidence that the GEAC not followed global regulatory norms of which India is a party. For example, the Cartagena Protocol on Biosafety, Rio Declaration on Environment and Development etc.
Some international scientists have raised doubts about Bt Brinjal and the way the tests were conducted.
Many Indian scientists have supported commercialization of Bt Brinjal such as Dr G. Padmanabhan of the Indian Institute of Science; Dr Deepak Pental, Vice Chancellor of Delhi University; and Dr Raj Bhatnagar of the International Centre for Genetic Engineering and Biotechnology, New Delhi. However, even they have mentioned the need for a statutory body with regulatory powers and R&D capabilities to govern all aspects of GM crops.
The Indian Council of Agricultural research and a number of farmer’s groups have come out in support of the move to introduce Bt Brinjal.

In order to understand the process followed by GEAC before giving the green signal to Bt Brinjal, we have made a timeline in which the plant was approved and the bodies involved in the process.

2000-2005	Scientific tests carried out by Mahyco on Bt Brinjal
2006	Mahyco submits bio-safety data to GEAC (regulatory body under the Ministry of Environment and Forests). Seeks permission for large scale trials.
	Supreme Court stops ongoing field trials of GM crops due to a PIL filed by civil society representatives.
2007	The expert committee 1 set up by GEAC, submits its report. Recommends seven more studies on bio-safety be repeated for reconfirmation of data generated during confined multi-location trials but approves large scale trials.
	Supreme Court lifts ban on GM crop field trials subject to conditions such as isolation distance etc.
	As per GEAC direction, Indian Institute of Vegetable Research (IIVR) takes up the responsibility of large scale trails of Mahyco's Bt Brinjal trials at 10 research institutions across the country in 2007 and 11 in 2008.
2009	Jan: IIVR submits the results of the large scale trails. Due to concerns raised by several stakeholders, GEAC constitutes another expert committee to look into adequacy of biosafety data generated as well as the concerns raised by all stakeholders.
	Oct 8: Expert-committee 2 submits its report. States benefits of Bt Brinjal far outweigh the perceived and projected risks.
	Oct 14: GEAC approves the environmental release of Bt Brinjal containing the event EE1 (with one dissent note from P.M. Bhargava).
	Oct 15: Jairam Ramesh announces a nationwide consultation in January and February of 2010 pending a final decision on this issue.
2010	Jan 13 to Feb 6: Public meetings were organized on the Bt Brinjal issue. The summary of the consultations is available on the Ministry’s website.
	Many states announce ban on commercial cultivation of Bt Brinjal including Uttarakhand, Himachal Pradesh and Karnataka.
	Feb 9: Jairam Ramesh decides to halt the commercialization of Bt Brinjal.

Policy

Central Transfers to States: Role of the Finance Commission

Gayatri Mann - April 11, 2018

In November 2017, the 15^th Finance Commission (Chair: Mr N. K. Singh) was constituted to give recommendations on the transfer of resources from the centre to states for the five year period between 2020-25. In recent times, there has been some discussion around the role and mandate of the Commission. In this context, we explain the role of the Finance Commission.

What is the Finance Commission?

The Finance Commission is a constitutional body formed every five years to give suggestions on centre-state financial relations. Each Finance Commission is required to make recommendations on: (i) sharing of central taxes with states, (ii) distribution of central grants to states, (iii) measures to improve the finances of states to supplement the resources of panchayats and municipalities, and (iv) any other matter referred to it.

Composition of transfers: The central taxes devolved to states are untied funds, and states can spend them according to their discretion. Over the years, tax devolved to states has constituted over 80% of the total central transfers to states (Figure 1). The centre also provides grants to states and local bodies which must be used for specified purposes. These grants have ranged between 12% to 19% of the total transfers.

Fig 1 Over the years the core mandate of the Commission has remained unchanged, though it has been given the additional responsibility of examining various issues. For instance, the 12^th Finance Commission evaluated the fiscal position of states and offered relief to those that enacted their Fiscal Responsibility and Budget Management laws. The 13^th and the 14^th Finance Commissionassessed the impact of GST on the economy. The 13^th Finance Commission also incentivised states to increase forest cover by providing additional grants.

15^th Finance Commission: The 15^th Finance Commission constituted in November 2017 will recommend central transfers to states. It has also been mandated to: (i) review the impact of the 14th Finance Commission recommendations on the fiscal position of the centre; (ii) review the debt level of the centre and states, and recommend a roadmap; (iii) study the impact of GST on the economy; and (iv) recommend performance-based incentives for states based on their efforts to control population, promote ease of doing business, and control expenditure on populist measures, among others.

Why is there a need for a Finance Commission?

The Indian federal system allows for the division of power and responsibilities between the centre and states. Correspondingly, the taxation powers are also broadly divided between the centre and states (Table 1). State legislatures may devolve some of their taxation powers to local bodies.

Table 1

The centre collects majority of the tax revenue as it enjoys scale economies in the collection of certain taxes. States have the responsibility of delivering public goods in their areas due to their proximity to local issues and needs.

Sometimes, this leads to states incurring expenditures higher than the revenue generated by them. Further, due to vast regional disparities some states are unable to raise adequate resources as compared to others. To address these imbalances, the Finance Commission recommends the extent of central funds to be shared with states. Prior to 2000, only revenue income tax and union excise duty on certain goods was shared by the centre with states. A Constitution amendment in 2000 allowed for all central taxes to be shared with states.

Several other federal countries, such as Pakistan, Malaysia, and Australia have similar bodies which recommend the manner in which central funds will be shared with states.

Tax devolution to states

Table 2 The 14th Finance Commission considerably increased the devolution of taxes from the centre to states from 32% to 42%. The Commission had recommended that tax devolution should be the primary source of transfer of funds to states. This would increase the flow of unconditional transfers and give states more flexibility in their spending.

The share in central taxes is distributed among states based on a formula. Previous Finance Commissions have considered various factors to determine the criteria such as the population and income needs of states, their area and infrastructure, etc. Further, the weightage assigned to each criterion has varied with each Finance Commission.

The criteria used by the 11^th to 14^thFinance Commissions are given in Table 2, along with the weight assigned to them. State level details of the criteria used by the 14th Finance Commission are given in Table 3.

Population is an indicator of the expenditure needs of a state. Over the years, Finance Commissions have used population data of the 1971 Census. The 14^th Finance Commission used the 2011 population data, in addition to the 1971 data. The 15^th Finance Commission has been mandated to use data from the 2011 Census.
Area is used as a criterion as a state with larger area has to incur additional administrative costs to deliver services.
Income distance is the difference between the per capita income of a state with the average per capita income of all states. States with lower per capita income may be given a higher share to maintain equity among states.
Forest cover indicates that states with large forest covers bear the cost of not having area available for other economic activities. Therefore, the rationale is that these states may be given a higher share.

Table 3

Grants-in-Aid

Besides the taxes devolved to states, another source of transfers from the centre to states is grants-in-aid. As per the recommendations of the 14^th Finance Commission, grants-in-aid constitute 12% of the central transfers to states. The 14^th Finance Commission had recommended grants to states for three purposes: (i) disaster relief, (ii) local bodies, and (iii) revenue deficit.

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To eat or not to eat: Bt Brinjal

Central Transfers to States: Role of the Finance Commission

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