Facing Imminent Defeat, Coca-Cola Tries to Set Terms in India

    For Immediate Release
    January 5, 2006

“No Longer Up to Coca-Cola to Dictate What Happens Next”

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

San Francisco: In a bold move, the Coca-Cola company in India has demanded that either they be allowed to re-open the closed factory in Plachimada immediately or they be allowed to shift the factory to a nearby industrial estate.

The campaign to hold Coca-Cola accountable is accusing the Coca-Cola company of trying to wriggle out of the major liabilities it has incurred in India.

The Coca-Cola bottling plant in Plachimada, in the southern state of Kerala, has remained shut down since March 2004 because the community will not allow it to operate- citing the plant for causing severe water shortages and pollution.

In a closed door meeting with Kerala state government officials on January 3, 2006, Coca-Cola company officials insisted that they had met all the conditions in order to obtain the necessary license to operate and that they were the target of a “misguided campaign.”

Coca-Cola’s operations in Plachimada and in India have been indicted at all levels, ranging from regular community protests, state government actions and central government and independent studies.

The local village council (Perumatty panchayat) in Plachimada has repeatedly refused a license to Coca-Cola because the company has not met the conditions to obtain a license, including obtaining no-objection certificates from the Pollution Control Board.

The Perumatty panchayat has offered Coca-Cola a 90-day, conditional license today, but the company has to satisfactorily answer seventeen questions posed by the village council, and also produce seven certificates. The company has fifteen days to respond.

The Kerala State Pollution Control Board issued a stop order notice to the company in August 2005 because of high levels of lead and cadmium around its bottling plant.

Adding to Coca-Cola’s woes, the state government of Kerala has also challenged the company’s right to extract water by appealing to the Supreme Court of India in September 2005, where the case will be heard shortly.

The state has argued 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.”

Coca-Cola company officials also demanded “appropriate” compensation if they had to move the facility in the form of “continued and increased sales tax incentives.”

Both the Plachimada Struggle Committee, which has spearheaded the local campaign as well as the Plachimada Solidarity Committee, a statewide network of support organizations, were not invited to the meeting and had harsh words for the Coca-Cola company.

“We all must recognize that the Coca-Cola company is no longer in the drivers seat, and that it is no longer up to Coca-Cola to dictate what happens next. That is left to the community and the people of Kerala,” said R. Ajayan of the Plachimada Solidarity Committee.

“There can be no resolution to the crisis if the community is excluded, and as such, this is an illegitimate process,” said C. R. Bijoy of the People’s Union for Civil Liberties.

There is also strong opposition to the idea of moving Coca-Cola’s bottling plant to an industrial estate in Puduserry, only 40 kms away from Plachimada. The entire area has been suffering from acute water shortages, and relocation of such a water intensive company will only exacerbate water conditions for the community. In fact, the local village council in Puduserry had revoked the license for a Pepsico bottling plant in 2003 because of severe water shortages. Additionally, local community leaders point out that Coca-Cola’s pollution of the groundwater and soil in Plachimada, which has been verified by the state government and independent studies, will continue in other areas.

“There is no easy way out for Coca-Cola because it has caused immense damage to both the people and the environment, and impacts will be felt for a long time. The lesson learnt from Plachimada is that we cannot allow such negligent practices anywhere,” said Amit Srivastava of the India Resource Center, an international campaigning organization.

“We welcome the growing realization by the Coca-Cola company that it cannot re-open its plant in Plachimada anymore because the community does not welcome it, and now we are committed to pressing other demands that the Coca-Cola company must meet,” said R. Ajayan.

In addition to demanding the permanent shut down of the bottling plant, the community led struggle in Plachimada has also demanded:
  • Compensation for affected community members who have lost their livelihoods as a result of the water shortages and pollution
  • Remediation of the area until the groundwater achieves the quality and quantity prior to the establishment of the factory
  • Admit long term liability for the health impacts to the community as a result of the pollution
  • Initiation of criminal proceedings against the Coca-Cola company for destruction of lives, livelihoods and environment
  • Introduction of appropriate government rules and regulations that ensure that such abuses do not happen again
  • Dropping of all criminal charges filed against activists engaged in the campaign
  • Setting up of funds to ensure retraining and relocation of workers currently working in the Coca-Cola bottling plant in Plachimada, including contract workers

The campaign to hold Coca-Cola accountable for its crimes in India enjoy tremendous international support, with most recently the University of Michigan deciding to cease business with the company effective January 1, 2006.

For more information, visit www.IndiaResource.org


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