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India: Pepsi and Coca-Cola Deny Pesticide Claims

by Edward LuceFinancial Times
August 6th, 2003

Coca-Cola and PepsiCo, the US soft drinks companies, yesterday angrily denied allegations that their products manufactured in India contained toxins far above the norms permitted in the developed world.

India's Centre for Science and Environment, a non-governmental organisation, announced yesterday it had conducted tests that showed Pepsi's soft drink products had 36 times the level of pesticide residues permitted under European Union regulations and Coca-Cola's had 30 times the level.

The CSE said it found toxins in all 12 of the soft drinks it tested including lindane, DDT, malathion and chlorpyrifos - pesticides that can contribute over the long term to cancer and breakdown of the immune system. The centre said it had tested the same products in the US and found no such residues.

"These companies take advantage of the fact that India has no regulations governing the quality of water that goes into soft drinks," said Sunita Narain, a director of the CSE. "They say they have global standards. But this proves that is not the case."

At a joint press conference yesterday, the heads of Pepsi and Coca-Cola's India businesses - both wholly owned by their US parents - suggested the allegations were politically motivated.

They also said they used the same quality control standards to test their products in India and the rest of the world. Pepsi and Coca-Cola dominate the Indian soft drinks market, which is growing at between 12 and 14 per cent a year.

"There is a desire to create panic and a deliberate scare," said Sanjiv Gupta, president of Coca-Cola in India. "We challenge the methodology of these tests and ask for a peer review of the top five scientists in India. There can be no question of double-standards."

Yesterday's report comes six months after the CSE published research alleging that India's leading bottled water brands, including those owned by Pepsi and Coca-Cola, contained much higher levels of toxins than permitted in the EU. Both companies denied the allegations.

It also follows allegations last month by the BBC that a Coca-Cola plant in India was emitting sludge that contained high levels of toxins harming local farmers in the state of Kerala. Coca-Cola denied the allegations. "You have to ask why these allegations keep cropping up," said Mr Gupta.

The CSE yesterday said it would welcome an independent review of its research and said its own tests had been conducted according to the established protocol of the US Environmental Protection Agency.

India has a reputation for being one of the most difficult markets to penetrate for global consumer brands. "I don't know whether these allegations are true or not, but there is a particularly receptive audience for such claims in India," said one foreign executive in New Delhi yesterday.

In 1984, more than 10,000 Indians died in a gas leak from a Union Carbide factory in the town of Bhopal, in the world's worst industrial accident. Union Carbide, since wound up, was manufacturing a highly toxic agricultural pesticide.

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