The village government of Pudussery, a rural community in the Palghat district of Kerala state, said last week that it had revoked the water-use license of the Pepsi bottling plant there because the plant had depleted the community's groundwater to the point of causing a shortage. The license was not due to expire until 2005.

A plant belonging to Hindustan Coca-Cola Beverages in nearby Perumatty was denied a license renewal last month on similar grounds. The company appealed to the Kerala High Court, which reversed the village's decision.

Coke and Pepsi, two of the most visible American brands in India, dominate the country's $1.2 billion market for soft drinks, one of the world's fastest growing. They compete fiercely to sell carbonated drinks and, increasingly, bottled water.

The two companies have been targets of protests against the Bush administration's policies in Afghanistan and the Middle East. Armed rebel groups, shouting anti-American slogans, on several occasions seized and looted soda warehouses.

But village leaders say that global political tensions have nothing to do with the water-license matter. "Because of the recent drought, water is already scarce in our area," said K. G. Jayanthy, president of the village council in Pudussery, which is controlled by the Communist Party of India (Marxist). "The local people are agitating that Pepsi is overutilizing water resources, making the shortage very acute."

Both PepsiCo and Hindustan Coca-Cola insist that they have not overused water resources. Pepsi said in a statement that a man-made lake in Pudussery and the company's "rainwater harvesting system" ensure that the community's groundwater levels are kept recharged. "Pepsi has been continuously monitoring the water-table depth, and has observed that there is no depletion of the water table," the company maintained.

Hindustan Coca-Cola said it was determined to keep its Perumatty bottling plant running. "Thousands of individuals rely on our operations in that state, and we are determined that we will remain an important part of that community and we will not let them down," a company spokesman said. Hindustan Coca-Cola said studies had shown that its bottling operations were not affecting groundwater reserves.

India has no effective laws for conserving groundwater, which is in short supply in many areas. Much of urban India lacks a 24-hour water supply, and in rural areas villagers must often walk several miles to fetch drinking water.

There are signs that the water protests against the two soft-drink companies may spread beyond Kerala state. Medha Patkar, an environmental campaigner known for her opposition to a dam across the Narmada River in western India, has announced support for the Pudussery council's action.

Ms. Patkar's National Alliance of People's Movements has added the issue of water use to its agenda against globalization and in favor of communalism in India. Sanjay Mangala Gopal, the organization's coordinator, said, "People from villages in Varanasi in Uttar Pradesh state in the north, and Thane in Maharashtra in the west, have also asked us to initiate agitations against the lavish use of scarce water resources by multinational soft-drink companies."

Kerala is one of the few regions of India where Communist parties dominate politics, and organizing against Coke and Pepsi went further there than in most other parts of the country. Party workers in the state succeeded in stopping store owners from stocking soft drinks and other American-made products for a while. But the boycott died out when the fighting in Iraq wound down.

Local industry groups support Hindustan Coca-Cola and PepsiCo, saying that license denials would scare away prospective investors from a state that badly needs investment and would cost the region thousands of jobs.

Local Communist leaders are unmoved. "If we don't stop this unlimited exploitation of groundwater, the ecological damage will be very serious," said Krishna Das, a member of Parliament from Palghat district.

Palghat is known for rice paddies, and Mr. Das said he was concerned that not just drinking water, but also supplies of water for irrigation, would be depleted by the bottling plants' heavy water use. He said he had not seen any detailed scientific study of the plants' effects, and called on the government to perform one.

Local residents say there is considerable hostility toward the bottling plants. "The tribals and villagers of this region took a while to wise up to the cause of the water crisis," said C. R. Neelakandan Namboodiri, who lives in the area and described himself as a leftist and freelance environmentalist. "But now even the womenfolk are mobilized, and are staging a peaceful protest at the gates of the Coca-Cola factory," Mr. Namboodiri said.

Meanwhile, the Kerala state government, led by the Congress (I) Party, is trying to play down the controversy over the bottling plants, and has sometimes sent the police to arrest pickets at the Coca-Cola factory. The state's chief minister, A. K. Anthony, has been quoted in local newspapers saying that the government will do all it can to ensure that the bottlers can carry on business smoothly.