The Karma of Coca-Cola and the Revenge of the Subalterns

Vinay Lal
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Whatever the virtues and pleasures of Coca-Cola, its sins have caught up
with it. In India, at least, it has been unable to escape its karma. Even as
PepsiCo has just chosen an American of Indian origin, Indra K. Nooyi, as its
fifth chief executive, Pepsi and Coke have been banned in the state of
Kerala. Five other Indian states -- Karnataka, Gujarat, Madhya Pradesh,
Punjab, and Rajasthan -- have imposed a partial ban, prohibiting the sale of
Cola drinks in schools, hospitals, and public offices.
Coke and Carcinogens
The present controversy over Coca-Colaarose when earlier this month the
Center for Science and Environment (CSE), a highly reputable NGO in New
Delhi, released a study which documents extraordinarily high and dangerous
levels of pesticide, including banned carcinogens such as Heptachlor and
Malathion, in all tested samples of Coke and Pepsi. CSEs scientists tested
57 samples of both colas from 25 different bottling plants across most of
India, and in some cases found pesticide residues 24 times higher than
standards adhered to by theEuropean Union and proposed by the Bureau of
Indian Standards. Both companies at once deniedallegations that their soft
drinks sold in India are dangerously contaminated, and Coca-Cola India
responded to the accusations with the claim that an independent laboratory
had tested samples and found them to conform to EU standards. This
controversy, however, is only the latest iteration of long-standing differences
between CSE and the two cola giants, which together control over 90
percent of Indias soft drinks market. In early 2003, CSE found nearly the
same level of pesticides in a large number of samples of both Coke and
Pepsi, and a joint committee of both houses of the Indian Parliament
affirmed in 2004 its corroboration of CSEs findings. The J oint
Parliamentary Committee, over the next two years, labored to set new
standards, which it reconfirmed for proposal to the Bureau of Indian
Standards in March 2006. The new standards still await acceptance by the
Indian Government.
Coca-Cola has had, however, a more tumultuous history in India than is
indicated by the controversy over the tests conducted by CSE, an
organization with substantial international standing that no one can easily
accuse of corruption or manipulation by political forces inimical to the soft
drinks industry. Hounded by the Indian government in the late 1970s, Coca-
Cola beat a hasty retreat from one large, hot, thirsty market; invited back to
India some years after the present Prime Minister, Manmohan Singh,
engineered the liberalization of the Indian economy in the early 1990s,
Coca-Cola once again finds itself immersed in uncomfortable controversy.
Its bottling plants are under siege, it stands accused of draining scarce water
resources, and activists and villagers have battled Coca-Cola on the streets
and in courts. No one is prepared yet to forecast its demise in India, but the
iron-clad laws of karma seem poised to extract the last drop of water from
the Cola that promises to keep its consumers feeling forever fresh.
Morarji Cola vs. Coca-Cola
Coca-Cola Indias web site makes no mention of the drinks chequered
Indian past. In 1977, Mrs Indira Gandhi, who had served as Prime Minister
for over a decade, was thrown out of power after voters punished her and the
Congress party for the excesses committed during the internal emergency of
1975-77. The Minister of Industries, George Fernandes, in the new J anata
government, which styled itself as a party devoted to swadeshi (self-
reliance), invoked a particular provision of the Foreign Exchanges
Regulation Act (FERA) which required foreign companies to dilute their
equity stake in their Indian associates to 40 percent if they wished to remain
in the country. Coca-Cola would not oblige and was given marching orders
to (as Mohandas Gandhi might have said) Quit India. In popular folklore,
the government of Morarji Desai, a teetotaler given to a spartan lifestyle, is
believed to have told Coca-Colathat, in lieu of observing Indian regulations,
Coke could reveal its formula and thus continue to stay in India. In this
respect, at least, Morarji Desai appears to have anticipated the present
Supreme Court of India, which has invited Coca-Cola to reveal its formula
and so assure itself an untroubled stay in India.
The great unmentionablein this thick plot is that Desai, a staunch believer in
nature cure, was habituated to consuming a glass of his own urine every day.
He maintained that regimen for at least two decades, at a time, moreover,
when auto-urine therapy was virtually unknown except to a few naturopaths
who would not have dared to pronounce in public the virtues of urine. Since
India was keen to flaunt to the outside world its modern credentials, it was
something of an embarrassment that the countrys leader was addicted to --
well, another drink, something that is decidedlynot modern, nor very useful,
indeed, in spreading the culture of consumerism or helping the rise of free
markets. (Urine is free, but this is not what the proponents of the free
market had in mind.) With Desai at the helm, one can understand why
Coca-Cola hadno future in India. Morarji Desai lived to the ripe old age of
99, something not even remotely within the realm of possibility for someone
brought up on a diet of Coke -- whether straight Coke, diet Coke, or Zero
Coke.
Coca-Cola and the Political Economy of Water
Coca-Cola resurfaced in India twenty years after its unceremonious exit.
With the growth of a consumer class, the demand for Coke and other rival
soft beverages, among them Pepsi, has grown tremendously. Though India
still occupies a minisculeplace in Cokes global operations, accounting for
something like onepercent of its worldwide sales, it represents a huge and
growing market. That industry executives have not taken the bans lying
down is amply clear from Coca-Cola Indias web site [www.coca-
colaindia.com], which affirmed within days of the report released by the
CSE that tests by the reputed Central Science Laboratory in London had not
found pesticide levels in Indian-produced colas beyond those permitted in
the European Union. CSE has responded that the British independent
laboratory only tested samples provided to it by Coca-Cola or Pepsi, not by
CSE or other agencies. Both Coca-Cola and PepsiCo have gone on an
aggressive campaign to defend their drinks, and largeposters and fliers have
been placed in shops and food markets in metropolitan centers assuring
customers that the soft drinks sold in India are safe. Since the allegation that
multinationals have differing standards for their products in the post-
industrial societies, emerging economies, and developing countries is one to
which all companies profess sensitivity, it is not surprising that Coca-Cola
Indias 11 August 2006 news release openly states that we have the same
uncompromising commitment to product safety and quality in our beverages
in India that we offer around the world.
The present dispute masks, however, considerations that are in some
respects far more serious, or certainly of greater import. If the allegations
of pesticide contamination are true, the levels of pesticide can be brought
down to meet international standards; but the inescapable fact remains that
Coca-Cola consumes increasingly scarce water resources. Among farmers
in India, Coca-Cola and PepsiCo are known as pani chors or water thieves.
The water table has fallen precipitouslyin many parts of India, and hundreds
of struggles between the beverage giants and local people have been
documented around the country. To take one example: in Kaladera, some 40
kilometers from J aipur, over 200 villagers from 22 neighboring villages
voted to demand the closure of the local Coca-Cola plant, which in nine
months ending in December 2003 had extractednearly 175,000 cubic meters
of water on the payment of a meager Rs 24,000 ($525) to the Indian
government. Among themost well-documented of these struggles has been
at Plachimada in Kerala, where the Coca-Cola Virudha Samara Samiti [Anti-
Coca-Cola Struggle Committee] organized a mass rally in August 2002 to
protest the appropriation of 1.5 million litres of water daily by the Coca-
Cola company. Hundreds of millions of Indians have no access to safe
drinking water, and activists allege that the actions of Coca-Cola and other
soft drinks manufacturers are calculated to aggravate acute water shortages.
When the political economy of water begins to be understood, Coca-Colas
place in that narrative will not be insubstantial.
Elites and Subalterns: Coca-Colas Proper Destiny
There are ample reports that the banson Coca-Colahaveled to demands for
the forbidden elixir on the black market, and it is unlikely that they will be
sustained for very long. The modern worlds addiction to sugared drinks is
of more serious proportions than the more frequently discussed addictions to
coke (of the other variety), tobacco, and alcohol. One of the more charming
stories told about Mohandas Gandhi, whose assassin blamed the Mahatma
for foisting upon the world his blind addiction to nonviolence, concerns an
old lady who arrived at his ashram with a six-year old boy in tow. Her
grandson, the lady explained to the Mahatma, was excessively fond of
sweets, and she wanted the lofty man to talk the young boy out of his
addiction to sugar. Gandhi asked her to return with the boy after a month.
When she did, the Mahatma spoke to him at some length on the unhealthy
consequences of excessive consumption of sugar and urged him to keep off
sweets. The old lady then said, You could have told my grandson the same
thing a month ago. Why did you have us return to the ashram? Gandhi
replied, I myself was eating too much sugar a month ago. I had to give it up
in the following weeks before I could ask your grandson to do so.
One suspects that Mohandas Gandhi, were he alive today, would have been
at least as receptive to the bans on Coca-Cola and Pepsi as he was to
prohibition. But if modern Indias disdain for Gandhi is any guide, one can
be certain that producers, vendors, and consumers of these beverages will
conspire to keep them in circulation. Nevertheless, the captains of industry
are alarmed that the bans on Coke and other colas, just when India has
finally become attractive to foreign investors, might have a chilling effect on
direct foreign investment in India. The Confederation of Indian Industrys
America-based representative, according to a report in the New York Times
(15 August 2006), has expressed hope that U.S. companies do not use this
[the bans] as a measure to decide whether to invest in India, and similarly
the President of the Indo-American Chamber of Commerce, Prabharkar
Bothireddy, has some misgivings that the bans could send the wrong
message to investors at a time when there are vast opportunities for
businesses in both countries to work together. Meanwhile, according to
the BBC, the US Under-Secretary for International Trade, Franklin Lavin,
was more forthright indeclaring that the bans constituted a setback for the
Indian economy. Lavin has characterized proponents of the bans as people
who do not want to treat foreign companies fairly and has criticized their
attempt to dominate the discussion, though the irony of having a
representative of the US Government intervene in the internal matters of
Indian states is evidently lost on him.
While industry executives, corporate leaders, and other lites in the US and
India have over the last few years continued to weigh in with their opinions
about Coca-Colaserving as a barometer of Indias growing economy and the
countrys norms of hospitality towards foreign companies, the subalterns in
India have in their own way stumbled upon the inestimable benefits of Coca-
Cola. On 2 November 2004, a year after the Center for Science and
Environment had first found inordinately large levels of pesticide in Coke
and Pepsi samples, J ohn Vidal of the Guardian reported that farmers in the
states of Andhra Pradesh and Chattisgarh had found that Coca-Cola worked
as an extraordinarily effective pesticide. At Rupees 30 a liter (about 75
cents), an acre of chilli and cotton fields could be sprayed for about Rupees
270 (less than $6), a fraction of the Rs 10,000 (some $220) that it would cost
to spray over the same area a pesticide produced by Monsanto, Dow
Chemical, and other large chemical manufacturers. Gotu Laxmaiah, a
farmer from Andhra, described to an Indian journalist that pests began to
die after the soft drink was sprayed on [my] cotton, and he characterized
himself as thrilled with the results. The astute Laxmaiah also noted that
Cokes advantages stemmed from a number of other factors, including the
fact that it could be handled without gloves. According to Vidal, there had
been similar reports from hundreds of other farmers.
Cola Coda
Coca-Cola, one might perhaps reasonably conclude, always does the right
thing. The revenge of the subalterns may turnout to be the revenge of Coca-
Cola, judging from the variouslives of Coca-Cola. In India, if nowhere else,
Coca-Cola should be thinking of its karma.