Providing the Facts for Mr. Tharoor on Coca-Cola in India

March 23, 2009

Mr. Tharoor:

I read with amazement your letter defending your role as an advisor to the Coca-Cola India Foundation.

I was amazed because you have completely misstated the facts relating to the shutdown Coca-Cola bottling plant in Plachimada and the company's bottling plants elsewhere in India.

As an advisor to the Coca-Cola India Foundation, along with your own proclaimed inquiry into the matter surrounding Coca-Cola's operations in India, it is incumbent upon you to be aware of the facts of the matter and state them as such.

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Not only have you failed in stating the facts, but it is dismaying to note that you repeat the same defense of Coca-Cola's operations in India as the Coca-Cola company itself!

For your benefit, and more importantly, the public in India, I would like to respond to your letter with the appropriate facts.

Scoring Political Points?

You accuse the authors of the open letter, Mr. Swaminathan and Mr. Ajayan, of attempting to "score political points" by releasing the open letter to the media and internet forums prior to you receiving the letter.

An open letter is just that - a letter intended to be read by a wider audience. It is not unusual to see such open letters making the rounds in internet forums and the media prior to reaching the specific person it is addressed to. And even a cursory internet search of open letters alongside your name reveals that you are well accustomed to such communication.

The intent of the open letter was to highlight to the larger public the problems the authors see with your association with the Coca-Cola company and the foundation, especially in the context of you "nurturing political ambition."

Mr. Tharoor, if anybody is trying to score political points, it seems to be you.

Just a week after your response, we read in the Yale Daily News dated March 5, 2009 that "Tharoor confirmed that he is planning to run for a position in India's lower house of Parliament, and said an official announcement would be released "in a week to 10 days.""

And the confirmation of your political run, strangely enough, came at a lecture at Yale University which was sponsored by the Coca-Cola World Fund!

It is you who is running for political office, not the authors of the open letter to you.

You used your response to lay out your views on the political climate in Kerala, asserted your identity as a Keralite, stated your commitment to increasing corporate investment in the state, the need to make it more business friendly, faulted the current negative image of Kerala, bemoaned the trend of workers having to seek jobs in the Gulf and elsewhere, asserted the need for safe drinking water for the state of Kerala, and even managed to throw in "energy resources, waste management, and the development of backward areas" - all very appropriate content for someone making a run for political office.

But you got the facts about Coca-Cola's operations wrong.

Coca-Cola India Foundation, Coca-Cola Company, Coca-Cola India?

You go to great lengths in your response to try to differentiate, unsuccessfully, between the Coca-Cola India Foundation, on whose advisory board you serve, and the Coca-Cola Company.

Mr. Tharoor, as someone who has been very involved in the campaigns against Coca-Cola in India for over seven years now, I am keenly aware of the declared differences between the two bodies.

But the facts are as follows:
  • The Coca-Cola India Foundation was set up by the Coca-Cola company on December 3, 2007.
  • The Coca-Cola India Foundation was set up with an initial funding of USD 10 million by the Coca-Cola company.
  • The announcement was made on Coca-Cola company letterhead, including the absurd "Little Drops of Joy" caption.
  • The only two quotes provided in the announcement were by Mr. Muhtar Kent, President and COO, Coca-Cola company and Mr. Atul Singh, President & CEO, Coca-Cola India.
  • Close to half the announcement of the foundation was about what the Coca-Cola company and Coca-Cola India (not the foundation) does.
  • The contacts listed for further information were the public relations company for Coca-Cola India.
  • The Coca-Cola India Foundation focuses on areas that the Coca-Cola company has decided.
  • The Coca-Cola India Foundation would cease to exist were it not for the funding from the Coca-Cola company itself.

The fact of the matter is that the Coca-Cola India Foundation is an integral part of the Coca-Cola family and its primary purpose is to manufacture a "green" and "benevolent" image of the Coca-Cola company and its products in India, never mind what the reality on the ground may be.

In your response, you claim that "the purpose of encouraging such a Foundation is precisely to ensure that the company looks beyond its commercial bottom-line and serves the people of our country."

The Coca-Cola company is a for profit corporation whose primary (and sole) purpose is to maximize profits for its shareholders.

The Coca-Cola company neither has the expertise, nor has it been invited, to serve the development needs of the people of our country. Providing safe drinking water to the Indian population, as you suggest being one of the Foundation's concrete projects, is out of Coca-Cola's realm. The company bottles water and puts a price on it, making a product that remains unaffordable for too many Indians - exactly the opposite of providing safe, drinking water to all.

Let us not forget that it has taken the Coca-Cola company until now - sixteen years after it started operations in India - to set up a foundation with an intention of preserving water and the environment.

Is this a proactive approach, as you claim? Hardly.

The decision to set up the Coca-Cola India Foundation is not so much the result of altruistic intentions of the Coca-Cola company as it is a strategic move on the part of the company to deflect attention away from the growing discontent with its operations in India.

It is also interesting to note that the focus of the Coca-Cola India Foundation, set by the Coca-Cola company, are water, environment, healthy living and social advancement - exactly the areas in which the Coca-Cola company is being challenged in India.

Why worker's safety and rights are not included are beyond our grasp. But if there was to be a vibrant labour campaign against Coca-Cola, be assured that the Coca-Cola company would ensure that the Coca-Cola India Foundation include worker's rights in their area of focus.

Coca-Cola's Pollution Confirmed by State

You claim that you are fully aware that groundwater exploitation and pollution led to the closure of the Coca-Cola bottling plant in Plachimada in 2004, yet you claim that you are "unable to understand the scientific basis" behind the charges being leveled against Coca-Cola in Plachimada.

It is absolutely unconscionable that you remain ignorant of the facts surrounding Coca-Cola's operations in Plachimada, yet you have the audacity to respond with such confidence to the original authors of the open letter!

Mr. Tharoor, why do you suppose that the Coca-Cola bottling plant in Plachimada, one of Coca-Cola's largest in India, remains shut down?

The Coca-Cola bottling plant in Plachimada remains shut down because the Kerala State Pollution Control Board (KSPCB ) has refused to issue the "Consent to Operate" to the Coca-Cola company.

On August 19, 2005, the Kerala State Pollution Control Board rejected Coca-Cola's application, and directed "the Company to stop production of all kinds of products with immediate effect."

The KSPCB rejected Coca-Cola's application because it found unacceptably high levels of cadmium in Coca-Cola's sludge (more than 400 to 600% cadmium beyond the permissible limit).

The KSPCB also established that the groundwater in the vicinity of the bottling plant had been contaminated with cadmium as a result of high levels of cadmium in Coca-Cola's sludge as well as effluent.

Specifically, the KSPCB order dated August 19, 2005 said, "Since the functioning of the Company in the present manner causes severe environmental problems, including poisoning/contamination of well water, the undersigned, by invoking the powers conferred under Section 25(4), 27(2) and 33 A of the Water (Prevention and Control of Pollution) Act, 1974 refuses to issue the consent to operate and, by rejecting the defective application submitted by the Company to stop production of all kinds of products with immediate effect."

The Kerala State Pollution Control Board's decision was based on scientific studies that it conducted on the samples it took from and around the Coca-Cola bottling plant.

Alarmingly, in international venues where we continue to challenge them, Coca-Cola company officials have repeatedly said that there is no scientific basis for proving the pollution allegations against them.

It is exactly the same defense you are claiming - lack of scientific basis. Are you suggesting that KSPCB's technical studies are not "scientific" enough for you?

Mr. Tharoor, we have come to expect such disregard for state government agencies such as the KSPCB from companies like Coca-Cola that operate with impunity in India.

For a person such as yourself, who is in the hunt for political office representing the people of Kerala, it is extremely unfortunate that you toe the same line as the Coca-Cola company, in spite of the scientific evidence by the state government against it confirming that it pollutes the groundwater.

In the event that the Coca-Cola company has not shared the KSPCB "stop production" notice in you personal inquiry, you can see it here - http://www.indiaresource.org/documents/kspcbAug192005.pdf

It is also worth noting that a formidable community mobilization took place in and around Plachimada to bring attention to Coca-Cola's abuses and challenge them. The actions of the state were a result of the public mobilization, without which it is very possible that the Coca-Cola company would have continued its ways in Plachimada.

And in the interest of educating yourself so as to better advise the Foundation, I would suggest that you also obtain the study of sludge conducted by the Central Pollution Control Board of Coca-Cola bottling plants in 2003. It is an alarming conclusion, to say the least. For at least 10 years, it seems the Coca-Cola company was distributing its toxic waste as fertilizer to the farmers around its bottling plants.

I would be curious to know if you would question the "scientific basis" of the Central Pollution Control Board study as well, which included Plachimada.

Coca-Cola's Water Extraction Restricted by Court, Case Pending

In your response, you note that "a Division Bench of the Kerala High Court ruled, in a judgment dated 7 August 2005, that the company was not guilty of unfairly exploiting the groundwater, and that indeed the groundwater in Plachimada continued to dry up after the company ceased operations, leading the Court to conclude that other factors, including a shortage of rainfall, were to blame."

Once again, Mr. Tharoor, you adopt exactly the same defense that the Coca-Cola company does when it comes to defending charges of water depletion in Plachimada, raising serious doubts about the integrity of your fact-finding.

First, and very importantly, it MUST be noted that the High Court judgment that you and Coca-Cola reference is currently being heard by the Supreme Court of India. As such, there is no resolution on whether Coca-Cola was unfairly exploiting the groundwater.

It is premature, and I would suggest, irresponsible, to conclude that Coca-Cola was "not guilty of unfairly exploiting the groundwater", as you have done.

It is noteworthy that while Coca-Cola makes mention of this particular 2005 High Court judgment on their website, there is no mention whatsoever of the case currently pending in the Supreme Court of India.

Secondly, and still quite importantly, the High Court judgment that you reference actually placed RESTRICTIONS on groundwater withdrawal by the Coca-Cola company, by no means a business as usual matter.

The judgment actually restricted Coca-Cola's water withdrawals by 75% of what it had originally been permitted.

The High Court judgment even mentioned that Coca-Cola could not withdraw any water if the rainfalls were below 30% of average.

And yes, water levels in Plachimada have continued to drop even after Coca-Cola ceased operations. This, in and by itself, does in no way absolve the Coca-Cola company's operations in the area of any wrongdoing. In fact, it begs the question as to why the Coca-Cola company located its bottling plant in Plachimada in the first place, given that Plachimada lies in the rain shadow region of Pallakad?

In other words, if the water conditions were already difficult to begin with, why did a beverage company with a massive thirst for water locate itself in that area?

Coca-Cola Implicated in Other Parts of India

In your response, you do not address Coca-Cola's operations in Kala Dera and Mehdiganj, even though the open letter to you clearly made reference to them "for similar destruction of environment, water and livelihoods."

Mr. Tharoor, the Coca-Cola company's indiscriminate practices are not just confined to Plachimada, as was noted in the open letter to you.

In fact, Plachimada points towards a pattern by the Coca-Cola company of regularly abusing water resources in some of the areas where it operates.

You have completely failed to acknowledge the pending problems created by the Coca-Cola company in Kala Dera in Rajasthan and Mehdiganj in Uttar Pradesh.

As an advisor to the Coca-Cola India Foundation, you should be well aware of the issues surrounding Coca-Cola's practices in these areas.

The community of Kala Dera has challenged the Coca-Cola bottling plant since 2003, making it very clear that the company's operations had exacerbated the water crisis in the area, and that Coca-Cola must shut down its plant.

In 2006, the Coca-Cola company was forced to agree to an independent assessment of its operations in India as a result of our campaign in the US. The assessment - paid for by Coca-Cola - was released in January 2008, and only looked at six bottling plants.

The assessment was a scathing indictment of Coca-Cola's operations.

The assessment, conducted by the Energy and Resources Institute (TERI), an ally of Coca-Cola, saved its strongest language for Kala Dera.

The assessment confirmed that the Kala Dera "plant is located in a water-scarce, drought-prone area" and that the water extraction by Coca-Cola has "significant impacts" on Kala Dera. The assessment went on to conclude that the Kala Dera "plant's operations in this area would continue to be one of the contributors to a worsening water situation and a source of stress to the communities around."

The assessment made four recommendations to Coca-Cola for the Kala Dera plant - including shutting down the plant - all of which made clear that Coca-Cola must not use the groundwater in Kala Dera anymore.

The four recommendations were:
  • Transport water from the nearest aquifer that may not be stressed
  • Store water from low-stress seasons
  • Relocate the plant to a water-surplus area
  • Shut down this facility

Needless to say, the community of Kala Dera welcomed the recommendations. But one summer has come and gone, and as another summer approaches - when the water shortages are most pronounced - and Coca-Cola continues its operations in Kala Dera.

Mr. Tharoor, the Coca-Cola company has decided to ignore the findings and the subsequent recommendations on Kala Dera, very similar to what you seem to have chosen to do in your response.

Coca-Cola's continued operations in Kala Dera also violate the precautionary principle that the company has ostensibly agreed to uphold - as a condition to joining the UN Global Compact, which you mention.

Coca-Cola knows, without a doubt, that continued operations in Kala Dera "would continue to be one of the contributors to a worsening water situation and a source of stress to the communities around." Yet, the company operates.

Coca-Cola's operations in Kala Dera make a mockery of the UN Global Compact and lends credence to the criticism that the voluntary guidelines of the Global Compact are ineffective.

We are now faced with absurd public relations exercises from the Coca-Cola company under the guise of corporate social responsibility. It has announced drip water irrigation initiatives with 15 farmers in the area to respond to the recommendations - in a village of 10,000!

In your response, you mention that your role as an advisor to the Coca-Cola India Foundation is to "ensure that the company looks beyond its commercial bottom-line and serves the people of our country."

Then perhaps you can begin with asking Coca-Cola to choose one of the recommendations of the TERI assessment. After all, why pay for a study if you are not going to abide by the findings and the recommendations? And while you are at it, perhaps you can also ask Coca-Cola to share the Environmental Impact Assessment it says it conducted, but refuses to share, citing "legal and confidential" reasons.

Similar to Plachimada, one of the salient features of the Kala Dera bottling facility is that it was located in an area that was already experiencing water shortages. The Central Ground Water Board of India had assessed the area as "overexploited" in its groundwater resources in 1998, yet Coca-Cola started their bottling plant in 2000. That Coca-Cola's bottling operations further exacerbated the already existing water crisis was to be expected.

In Mehdiganj in Uttar Pradesh, the TERI assessment warned Coca-Cola of deteriorating water conditions, and has found an alarming increase in pollution as one gets closer to the Coca-Cola bottling plant - validating what the community has been saying all along.

Mr. Tharoor, Coca-Cola's problems in India are far from over, and this is primarily because Coca-Cola has committed wrongs in India and instead of incorporating genuine operational changes to the way it conducts its business in India, the company has resorted to addressing the growing opposition against its plants through its public relations department.

The Coca-Cola India Foundation, who you advise, is part of the public relations exercise and yet another attempt by the Coca-Cola company to try to deflect attention from the very real crises it has created in India.

Sure, water conservation initiatives in India and around the world are welcome, and massive water guzzlers like the Coca-Cola company should be at the forefront of cutting down their inefficient water usage.

But they must first walk the walk before they can talk the talk.

Genuinely addressing the crises it continues to create in India would be a positive first step.

Appointing celebrity advisors such as yourself to their Coca-Cola India Foundation is not.

Amit Srivastava
India Resource Center

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