Many crops of developing countries have a global value because of the special chemical compounds they contain like aromatic or other oils. In recent years, however, biotechnology and agribusiness companies have found ways of obtaining some of these valuable compounds through genetically engineered (GE) crops. As a result, genetic engineering is providing alternative ways for developed societies to procure commodities that have traditionally been supplied by developing countries. Naturally, the shift in trading patterns threatens the economic base of farmers who have traditionally grown the crops from which these products were made.
The production of High Fructose Corn Syrup (HFCS) from corn, a major GE crop bred for industrial applications like this, has undermined sugar prices and distorted sugar markets for cane sugar producers of developing countries like India. Coconut is another victim of genetic engineering. Coconut provides high value oil used for edible and for industrial purposes. The main advantage of this oil is the high lauric acid that it contains. The US alone imports upwards of US$ 350 million worth of coconut and palm oil annually. Now genetic engineering is creating GE canola to produce the same special high lauric acid oil as coconut. This research will have highly negative economic implications for farmers in coconut producing regions.
Technology alone is not responsible; these changes are made possible by massive agricultural subsidies in the developed world for corporate farming. These are a source of grave distortion in international agricultural trade, accelerating the changes created by new technologies.
Calgene has produced a high lauric acid rapeseed by using genes from the California Bay tree. This rapeseed will ultimately displace the coconut and palm kernel oil and deprive Asian farmers of revenues. The argument that coconut farmers could nevertheless derive some income from other coconut products is weak - there are great difficulties that developing country farmers confront in finding new markets for their crops. The loss of the coconut oil income, the farmers' principal revenue opportunity in certain regions, will inflict severe economic hardship.
Intellectual Property Rights
Access to GE technology is largely impeded by the stringent IPRs that surround it. Most of the basic technologies of genetic engineering are patented and the larger companies own these patents. These companies are reluctant to license many technologies to developing country organisations at an affordable cost. Patent laws do not require them to do so, so they are not obliged to grant any licenses if they prefer to control the technology themselves. Patent holders often refuse to license patents for key technologies to scientists and even to public sector institutions. Also, companies often seek patents not necessarily to conduct research themselves but to prevent research in areas that would threaten their monopolies. It is of concern that public research institutions are also getting into the patenting of plant technologies and research tools, further restricting access to genetic material and research data that are needed to cross complement research efforts.
Patents with an excessively broad claim are becoming increasingly problematic. They violate the ethical intent of patent law, which is to balance private gain with public good, while leaving the way open for further innovation. Excessively broad claims like the one granted to Monsanto on 'all types of genetic transformation in all varieties of soybean' (European Patent Number 301,749), are contrary to the original intention of patent law. They are monopoly instruments restricting useful research and therefore diminishing social welfare
Pressure back on using GURT technology
The use of Gene Use Restricting Technology (GURT), popularly known as the 'terminator' technology', is being discussed again. The US under the Indo-US deal on agriculture is also putting pressure to change the IPR regime and labeling and other provisions for GE crops. GURT is in fact banned in India under the Protection of Plant Varieties and Farmers Rights Act, 2001, but there is a lot of pressure globally including at the Biosafety Protocol meeting in Curitiba this year.
It has historically been well understood that farmers own not just the crops they harvest in one season, but the seeds needed to continue their occupation as well. But with the arrival of GURT, this understanding is put at risk. The technology - which allows farmers to grow only one crop from the seeds they purchase, but does not allow the farmer to save viable seed from his crop for the next sowing - was kept in cold storage after widespread outrage at its anti-farmer focus but it is back on the corporate agenda and awaiting adoption. GURT is an example of how genetic engineering has been used not to improve a crop or bring benefits to farmers but solely to enhance the control of the seed company over the variety they have bred.
When technological change has the potential to put the livelihood or other interests of hundreds of millions of people at risk, it must be regulated differently from other products in a free market. While promoting innovation is a valuable goal for modern economies, such innovation would be self-defeating if it resulted in social or economic upheaval. This is precisely the risk now posed by genetically engineered crops.