IRC- Coca-Cola - Water Wars and Bottle Battles

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Water Wars and Bottle Battles

By Nityanand Jayaraman
India Resource Center
May 24, 2005

Gangaikondan, Tamil Nadu, South India: A proposal by South India Bottling Company Private Limited (SIBCL) - a Coca-Cola franchisee - to set up a Rs. 280 million (US$ 6,500,000) soft-drinks unit in Gangaikondan village of Tirunelveli district in southern Tamil Nadu has run into trouble. Many local residents, political parties and environmentalists have raised concerns that the water-intensive plant will deplete and contaminate groundwater, and draw from Tamiraparani river that cannot fully meet even drinking water and agricultural needs of local communities. Coca-Cola's reputation in Plachimada, Kerala, Mehdiganj in Uttar Pradesh, Kala Dera in Rajasthan and nearby Sivagangai -- where Dalit and indigenous communities have been pitched in battle against Coca-Cola over the depletion of groundwater and pollution by its bottling units -- has fuelled suspicion of the proposed plant. Research by the India Resource Center revealed a number of discrepancies and misinformation in SIBCL's public statements regarding its water usage and daily production.

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SIBCL is keen to distance itself from Coca-Cola and its controversial track record. "We're not Coca-Cola. We're a franchisee. It is totally South Indian owned, and we're bringing in the money. Coca-Cola will merely provide the technology," says J. Ramamoorthy, SIBCL's executive director. But locally, and even among SIPCOT and Pollution Control Board officials, the project is referred to as the "Coca-Cola company."

A section of local residents, particularly elected members of local governments have extended their support to the company. They argue that the company will bring much-needed jobs and boost the local economy. Company spokespersons go one step further to say that if the company runs into trouble here, other investors will refuse to set up in Gangaikondan.

"This is the first big investment in SIPCOT Gangaikondan. For many years, it has had no takers. If our project has problems, the other companies that are looking at Gangaikondan will not come here," says V. Lakshmipathi, who introduced himself as SIBCL's 'site incharge' at the new soft-drinks bottling plant coming up at the State Industries Promotion Corporation of Tamil Nadu (SIPCOT) Industrial Growth Centre in Gangaikondan, 15 km from Tirunelveli.

Ironically, the veiled threat of economic "untouchability" or a flight of capitalists that Lakshmipathi conveys, comes less than a decade after Gangaikondan and nearby villages witnessed a three-year spate of bloody caste violence in the mid-1990s to end the practice of untouchability.

Residents of the Manur Panchayat Union, within which Gangaikondan village falls, are predominantly Pallars, a Dalit (former untouchable) caste. The Dalit uprising of the 1990s saw scores settled for centuries-old oppression - primarily with the upper caste Thevars.

"For every Pallar that was killed, the Thevars lost two or three. Pallars were barred from wearing new clothes - they had to be worn by somebody from an upper caste first," says R. Kanakaraj, a Tirunelveli-based Dalit lawyer and convener of a Joint Action Committee for Conservation of Tamiraparani River and Groundwater.

The Industrial Growth Centre in Gangaikondan was set up by the SIPCOT about 15 years ago on 2,033 acres of land. According to local sources, the government wanted to promote economic growth in the region as a means to defuse caste tensions.

Gangaikondan's fear of becoming "economically untouchable" seems to be one of several issues clouding what may be genuine concerns about the impact of a project that extensively uses local water resources. Indeed, available information for making informed choices is sketchy at best.

What is known about the proposed factory from company sources can be summed up in a few lines:

SIPCOT will provide SIBCL a maximum of 500,000 liters of water per day from the 4.5 million liters that SIPCOT is authorized to draw from an infiltration well in the riverbed of the perennial Tamiraparani River at Seevalaperi village.
At least 200 people will benefit directly; more than 500 including dependents of workers and new entrepreneurs such as petty shop owners will be the indirect beneficiaries.
The 7-acre factory unit within the 36 acre campus has a maximum capacity to manufacture only 200,000 bottles per annum.

Local residents and public interest organizations say there is undue secrecy surrounding the project. "I literally stumbled upon the construction when I went looking for my cows," says S. Elosius, a resident of Thuraiyoor. "Here's a company set a kilometer off the road in the midst of the forest. Even when it's fully constructed, people can't see it," he says. "How can it be that it is the area's largest investment, and I come to know of it only by accident two months after construction has begun?"

Dr. R. Murugesan, a professor and district vice president of the Tamil Nadu Science Forum, has strong words about government agencies. "It is not possible to find out anything relevant about the project beyond what little information the company has made available. The Pollution Control Board and the District Collector are against public interest. The Collector claims he knows nothing. But we hear that heavyweights in the ruling party are backing the project," he says.

Murugesan also explains that the unit's location is strategic. "The plant is in a depression abutting an area fed by the Semboothu springs. Groundwater quality in the area is excellent," says Murugesan citing an analytical water quality study he did of nine open wells and bore-wells in the area earlier this year. "Parameters such as chloride and hardness are well within permissible levels. If groundwater is used for bottling, purification costs would be very low," he reasons.

The company has assured that it will not sink bore-wells within the factory premises, and that it has no plans to expand. However, local reports insist that a team of three geologists from a nearby university helped identify suitable locations to sink bore-wells. More than 30 such spots are reported to have been identified. According to a reliable local source, one bore-well has already been constructed within the site and covered with concrete works. This is reportedly the source for water for construction, and an open well outside the factory is being shown as the source to mislead people.

Inspection of the Tamil Nadu Pollution Control Board (TNPCB) "consent order" reveals another discrepancy. Contrary to company's claims that only 500,000 liters of water would be required, the TNPCB records reveal that 900,000 liters have been earmarked for SIBCL. Of this, the TNPCB documents reveal that 350,000 liters will be used for manufacturing soft drinks. The remaining waste water will be reused, including for green belt development within the premises.

SIBCL's Lakshmipathy clarifies that an effluent treatment plant and a Reverse Osmosis unit will purify the wastewater which will be used for gardening purposes, and the sludge will be disposed off or sold as fertilizer. This is hardly reassuring, when a similar practice by Coca-Cola of selling waste sludge as manure to farmers in Plachimada, has reportedly led to groundwater and soil contamination. Scientific studies by various government and non-government agencies confirmed the presence of unacceptable levels of toxic metals such as lead and cadmium in the sludge.

Bad Mathematics

Accurate information about the installed capacity of the plant -- or how many liters of product will be manufactured from the 500,000 liters that the company claims will be drawn daily -- is hard to come by. The company's claim that it will only manufacture 200,000 bottles a year doesn't add up to its stated water requirement.

Ramamoorthy is vague about details regarding the actual quantity of soft drinks that can be produced at the plant. When asked whether the 200,000 bottles will be of 5 liter capacity or 500 ml capacity, Ramamoorthy says "It's hard to tell at this point. We can only let you know after we start producing." But that makes it difficult to verify the claim that 500,000 liters, or 900,000 liters as per TNPCB, would be used.

Assuming a maximum-case scenario where 200,000 5-liter bottles would be manufactured each year, the total water requirement works out to a mere 1 million liters a year or 2740 liter of soft drinks a day. At 500,000 liters, SIBCL's maximum daily water usage is 183 times more than its maximum stated daily production. And at 900,000 liters per day, going by TNPCB figures, the company's maximum daily water usage is 328 times more than its stated daily production of 2740 liters per day.

In 2002, Coca-Cola's bottling unit in Nemam village of Tamil Nadu was authorized to draw 2.5 million liters of groundwater each day. According to figures made available by the TNPCB at the time, 1.2 million liters is used for washing bottles, crates, equipment and the floors. Only 692,000 - less than 30 percent - is used for actually manufacturing the soft drinks.

Going by the soft drink-to-wastewater ratio (1:2) of the Nemam plant, SIBCL' s Coca-Cola bottling unit shouldn't require more than 8,220 liters of water per day as against their stated daily requirement of 500,000 liters.

Glaring discrepancies such as this don't seem to have been enquired into by the authorities or local people supporting the company. Kanakaraj says the TNPCB has cleared the proposal without going into the impacts of the project, but based purely on the fact that the Tamil Nadu Water and Drainage Board and the Public Works Department cleared the company's request for drawing 500,000 liters from the SIPCOT intake.

Information Drought

Local supporters of the project from Thuraiyur and Aladipatti villages interviewed by India Resource Center also acknowledged that their support stems from the promise of jobs and not on informed choice based on an accurate understanding of the project and its impacts. "We don't know the full details of the project. This is the first big investment in our region. We can't reject the first investment that comes our way. We need the jobs," says A. Rajesh Babu, an elected councilor in Manur Panchayat union.

S. Isravel, a Panchayat member from Aladipatti, also says that he is supporting the project because of the promise of jobs. "I believe the company. I have no other information but what the company has given," Isravel says.

Scratch the surface of the debate, and long-conditioned caste perceptions surface. P. Kirupairaj, a member of Puthiya Thamizhagam - a Dalit political party led by Dr. K. Krishnaswamy - explains the dilemma that Pallar residents face. "The reason why some people support the project is probably because it's been 15 years since SIPCOT started and there have been no takers. Some people feel that this area is being neglected because we're Pallars, and that it is unwise to oppose the first company that comes here. People feel that resistance is futile; that all this is fated and that we don't really have a choice."

Kirupairaj however is quick to point out the fallacy in the belief that locals really don't have a choice. "We have won significant victories in our struggle against discrimination. It is known that when we (Pallars) set our minds on something, we persist till we win. We have to make our people aware of the potential benefits and the dangers. Even now, we're not opposing all projects. Only projects like Coca-Cola that pose a threat to our water resources," he says.

On 18 May, 2005, Dr. Krishnaswamy condemned the project and joined a veritable list of political parties, including the Communist Party (Marxist), Communist Party of India, Congress, MDMK and DMK opposing the project. Krishnaswamy's entry into the fray, though, should set alarm bells off for SIBCL. The Dalit leader still holds significant sway over the masses in the region, and has the ability to swing the opinion of SIBCL's Pallar hosts.

Depriving a Thirsty Populace

The most convincing argument of those opposing the project has to do with the fact that drinking water and agricultural requirements are not currently being met by the water allocations from Tamiraparani River. "Charity begins at home," says S. Sunderaraja Perumal, president of the District Congress Committee Tirunelveli (Urban). "Within the Tirunelveli corporation limit, there are four to five places where people take to the streets because they get no water or insufficient water. They are all Scheduled Caste (Dalit) people, some of whom live within 30 meters of the river. How can you take water for Coca-Cola when you haven't even provided drinking water to your population?" the Congress leader questions.

Perumal says he is not opposed to drawing Tamiraparani water for drinking purposes. "They're taking water for drinking water needs in Kovilpatti, Sankaran Koil. We're not opposed to that. But water cannot be put on sale to a company that uses water as the raw material and sells water as a product. 500,000 liters of water can comfortably take care of the water needs of 5000 people within Tirunelveli town," he says.

R. Krishnan, a member of the Communist Party (Marxist) and former member of the state legislature, echoes Perumal's sentiment: "The difference is that this company is treating water as a raw material and selling it. That is wrong. SIPCOT's 4.5 million liter requirement is for the basic needs of industries that will come up in the industrial estate. Earmarking 10 percent of the total water intake for one company that occupies just 31 acres of a 2000-acre industrial estate is ridiculous."

Coca-Cola: A Chequered History

Community concerns about Coca-Cola's exploitation of common groundwater resources are not isolated to Gangaikondan. Neither does its track record in India and elsewhere corroborate its claims of "responsible corporate citizenship."

In Plachimada, Kerala, Coca-Cola's soft-drinks bottling plant has been accused by locals of having depleted and polluted the groundwater. Sludge from the wastewater treatment plants was found to contain toxic metals at unacceptable levels.
Capt. J. Rama Rao of Hyderabad-based NGO Samriti writes about Sri Sarvaraya Sugars, a bottling unit dedicated to producing Coca-Cola's Kinley brand of water located in Khammam district of Andhra Pradesh. The factory draws 225,000 liters of water per day. "As a result, the bore-wells in certain areas of Sattupalli village, having a population of 25,000 are reported to have dried up," writes Rao. The Coca-Cola spokesperson dismissed these allegations as "politically motivated."
M.V.R. Mineral Water and S.R. Minerals, both of whom are contract bottlers for Coca-Cola's Kinley brand of water, have also been accused of depleting the groundwater in Athur village, 40 kilometers northwest of Chennai. M.V.R. Mineral Water reportedly extracts 132,000 liters of water each day. "The bottling units have sunk very deep bore-wells and are sucking out so much water that farmers are suffering," says A.V. Chandra, a local activist with Redhills-based NGO Women's Collective.
Disturbingly, Kinley's bottling units are located in an area that has been declared sensitive because of the plentiful sweet water available underground and because of the area's importance to the water security of the region and the city of Chennai. Local pollution control board officials fear that the highly saline effluent from the factory's water purification plant will gradually turn the local aquifers brackish. "This is a drinking water area. It is not good to have industries that generate and discharge high-salinity wastes in this area," says Sheela Rani Chunkath, chairperson of the Tamil Nadu Pollution Control Board.
In 1999, the Goa Pollution Control Board issued a notice to the multinational for operating its new factory without securing the official consent. The company functioned for more than 40 days without the prescribed effluent treatment systems.

Despite long-standing demands, water from the Tamiraparani River has not reached needy farmers either. Local activists allege that the government has failed to pay attention to the conservation of water. Instead, water has systematically been allotted to the highest bidders in direct contravention to Indian national policy that prioritizes drinking water and agriculture over industrial uses.

Gangaikondan is a case in point. Most local farmers abandoned agriculture more than 10 years ago. Farming and animal husbandry in this region is dependent on canal-fed irrigation feeding off the spill-off from tanks. The Thenkalvai or Southern Canal feeding the Manur and Gangaikondan tanks with Tamiraparani water has long been severed by encroachments.

This year was the first time the tanks had water in seven years. Long-standing demands to release river water to the tanks remained unheeded until the region's farmers decided to diversify to less secure livelihoods as coolie workers in manufacturing, quarrying or construction industries.

Residents point out, though, that cattle and sheep-rearing are popular livelihoods here. Now that the tanks are dry, livestock are maintained on bore-well and open well water. The Tamiraparani River water delivered to the villages is sufficient only to take care of their drinking water needs. Any effect on groundwater will impact the livelihoods of those dependent on rearing livestock.

The Kodagon Canal, yet another potential lifeline to the Gangaikondan region, has never made it to Gangaikondan despite promises by various political parties. Kanakaraj explains why. "Kodagon Canal comes from Sutthamali on Tamaraparani River via Sethuroyan Pudur. Shankar Cements is mining limestone on the edges of the proposed canal route. If the canal comes, water levels will go up in the area, and it will be difficult for them to quarry limestone. So that project is being held up."

According to Kanakaraj, choking off the waters to the village tanks led to huge unemployment and economic insecurity. That had the effect of making Dalit youth available as takers of unprotected and vulnerable jobs on a contract daily wage basis,

Divided Waters

Tamiraparani's waters are probably already at the edge of resource stress. Local residents agree that the quality and quantity of water in the river is worsening. They attribute the deterioration to encroachment, pollution, industrial intakes and the increasing number of drought-prone towns in nearby districts that are being served with Tamiraparani's water.

SIPCOT's intake point in Tamiraparani River is at Seevalaperi village, less than a kilometer downstream of the Tamiraparani's confluence with the Chittar River. There are already 14 infiltration wells in the riverbed. That includes four wells for SIPCOT, and 10 wells supplying drinking water to Kovilpatti and villages en route.

Further downstream, industries in Tuticorin such as SPIC and Sterlite, draw water from the river. Plans are afoot to draw from the river for the Koodangulam nuclear plant and a High-tech park at Nanguneri. "How is it that there is enough water for industries when there isn't enough to give as drinking water to people living in Tirunelveli," asks Perumal.

Puthiya Thamizhagam's Kirupairaj sums up the demands of the local people succinctly. "We want industries here. We're not opposed to MRF that proposes to set up a rubber factory here, or the two proposed spinning mills. But we want labor intensive industries and not those that threaten our water resources."

The Gangaikondan issue once again throws up a conflict that is slowly manifesting itself: who has control over water resources, and what quantifiable rights do individuals and communities have to water? While industries all over India have had no trouble earmarking generous quantities of the scarce ground and surface water resources for their use into eternity, no such clarity has emerged on what quantifiable rights citizens and communities have to water, even drinking water. The challenge in Gangaikondan is articulating these concerns and struggling for legitimate rights in the context of age-old caste conflict which also demands resolution.

Nityanand Jayaraman is a freelance journalist based in Chennai.

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