Kerala State Joins Community in Challenging Coca-Cola's Use of Water

State Defends Village Council Decision to Revoke Coca-Cola License

For Immediate Release
September 15, 2005

R. Ajayan, Plachimada Solidarity Committee (India) Tel: +91 98471 42513
Amit Srivastava, India Resource Center (US) E: info@IndiaResource.org T: +1 415 336 7584

San Francisco (September 15): In another major defeat for the Coca-Cola company in India, the state government of Kerala has challenged the company's right to use groundwater in the Supreme Court of India, arguing that water is being taken from poor communities to produce drinking water for the rich.

The state government of Kerala has specifically appealed a Kerala High Court ruling of April 7, 2005 that allowed the Coca-Cola company to extract 500,000 liters of water per day, under normal rainfall conditions.

Stating that "poor villages are deprived of drinking water due to overuse of ground water by Coca-Cola plant at Plachimada to produce bottled drinks for sale to people who have purchasing capacity in different cities of the country," the state government also argued that the local village council (panchayat) was within its rights to cancel the license of the Coca-Cola plant because it was protecting the interest of the community.

The state argued that the April 7 High Court decision violated the right to life guaranteed under Article 21 of the constitution of India, adding that the High Court should have ruled that the groundwater belonged to the public.

The Coca-Cola bottling plant in Plachimada in the southern state of Kerala, is one of Coca-Cola's largest in India. The bottling plant has remained shut down since March 2004 because the village council refused to renew Coca-Cola's license, citing the company for creating severe water shortages and pollution in the area.

The state government's decision to move the Supreme Court is significant because the state position supports the position of the community - which has insisted that the Coca-Cola bottling plant has been responsible for water shortages in the area.

The Perumatty panchayat (village council) has also appealed the April 7, 2005 Kerala High court ruling to the Supreme Court.

The state appeal comes less than a month after a decision by the Kerala State Pollution Control Board which ordered the Coca-Cola bottling plant to "stop production of all kinds of products with immediate effect" on August 19 because of high levels of cadmium around the bottling plant. The bottling plant was conducting "trial runs", in complete violation of India laws.

"The state of Kerala has heard the people of Kerala. The Coca-Cola company should get the message now - they should pack up and leave", said R. Ajayan, convener of the Plachimada Solidarity Committee, a statewide coalition of organizations supporting the local campaign.

The Coca-Cola company is in serious trouble in India, as communities across India are experiencing severe water shortages and pollution as a result of the company's operations. Local campaigns against the company have gotten significantly stronger in the last year, and literally thousands of people, mostly rural villagers, are involved.

The state appeal also argued that over extraction of water by the Coca-Cola company was violative of three international legal regimes including American Common Law Reasonable Use Rule, the Restatement (Second) of Torts Reasonable Use and the Doctrine of Correlative Rights, governing the use of ground water.

"We welcome the state's appeal which validates the community's assertion that Coca-Cola's huge extraction of water has come directly at the expense of the local community", said Amit Srivastava of the India Resource Center, an international campaigning organization. "This is also a major step asserting the rights and jurisdiction of local governments, and we look forward to a swift decision from the judiciary asserting the community's rights over natural resources."

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