11.2.2.3 Coca-Cola in India

In 2003, Coca-Cola and its subsidiaries operating in India were accused of extracting groundwater causing severe water shortages for the local community and putting thousands of farmers out of work. Coca-Cola was also accused of illegally discharging its waste water, thereby polluting groundwater and soil (Indian Resource Center, 2004). In addition to calling for the permanent closure of the Coca-Cola bottling plant and compensation for damages, the campaign also demanded that the Coca-Cola company be held criminally liable for its actions in Plachimada (Indian Resource Center 2008). Various cases were brought to trial in a number of districts in India. In particular, the decision of a municipality not to renew Coca-Cola's licence to operate was challenged before the High Court of Kerala State in December 2003 (Permatty Grama Panchayat v State ofKerala).1The Court found that the answer to the over-exploitation of groundwater and the possible justification for the decision of the municipality to revoke the licence, should be based on public interest (Right to Water, 2008). The Court recognised that the State as a trustee is under a legal duty to protect natural resources, which cannot be converted into private ownership. In addition, the Court added that the government had a duty to "protect against excessive groundwater exploitation and the inaction of the State in this regard was tantamount to infringement of the right to life of the people guaranteed under article 21 of the Constitution of India". In its ruling, the Court ordered Coca-Cola's plant to stop drawing upon groundwater within a month, ruling that the amount of water extracted by the plant was illegal. At the same time however, it ordered the municipality to renew the licence and not to interfere with the functioning the company as long as it was not extracting the prohibited ground water. In an appeal lodged by Coca-Cola, the divisional bench of the High Court granted permission for the company to extract 500,000 litres of groundwater a day in 2005-2006. The Court also affirmed that the municipality was not justified in cancelling Coca-Cola's licence to operate until a full scientific assessment had been made of the facts (Right to Water, 2008). In October 2008, it was reported that the Kerala Minister of Water Resources had agreed to set up a committee to look into the claims by the community affected by Coca-Cola's operations (India Resource Center, 2008). By March 2010, the committee recommended that Coca-Cola be held liable for USD 48 million for damages caused as a result of the company's bottling operations in Plachimada (India Resource Center, 2010). There are many sides and aspects regarding the Coca-Cola saga in India. An interesting overview has been published in

CSREM (Hills and Welford (2005); Burnett and Welford (2007)).

By 2010, the various parties were still fighting each other in court. At the same time however, the problems in India had ignited the start of a worldwide collaborative partnership between Coca-Cola and the World Wide Fund for Nature (WWF) aimed at understanding watersheds and the complexity of water as an ecosystem service, sharing information on the water usage of Coca-Cola, working with local communities, and developing a common framework to preserve water sources (Senge, 2008).

In its 2006 Sustainability Review, Coca-Cola indicated that its consumption of water in India had been reduced by 35 per cent from 1999 to 2006. In its 2007-2008 Sustainability Review, Coca-Cola reported that it had established a foundation in India focusing on "water stewardship". And in its 2008-2009 Sustainability Review, the company stated: "In India, our goal is to be a "net zero" user of groundwater by the end of 2009 by recharging the amount of groundwater used in our operations through supporting hundreds of rainwater harvesting projects. We also support drip irrigation and other initiatives like this step well in Jaipur". Coca-Cola is also one of the partners of the 'CEO Water Mandate' (section 11.3.4). It appears, the complainants have succeeded in gaining the company's attention.