Indian Court Rejects Village Ban On Pepsi Plant

Contention over how much water the plants uses

A village council in southern India had no right to cancel the operating license of a local PepsiCo plant, a court ruled on April 10. The council of Puthussery village in Kerala state decided in 2004 to cancel the operating license it gave the PesiCo.'s plant.

The council made the decision after a study by a New Delhi-based environmental group charged the company was using too much ground water.

"There is a government-appointed official who oversees such issues and takes the appropriate decision," the Kerala High Court ruled. There was no immediate comment from PepsiCo, but it had earlier rejected claims used too much water. The plant continued to operate while the case moved through the courts.

Environmentalists said they would challenge the decision in India's Supreme Court. "The court has favored the U.S. cola giant without considering the hardships of the poor," said R. Ajayan, head of the Plachimada People's Struggle Coordination Committee. "The village is facing an acute water shortage as PepsiCo is drawing excessive ground water," he said. His group had earlier challenged a Coca-Cola bottling plant in Plachimada village in the same district, 43 miles away, forcing it to close down in 2003.

Kerala has proved difficult territory for the big cola multinationals. Last year, the state banned the sale and manufacture of the cola drinks after the New Delhi-based Center for Science and Environment claimed the products contained high levels of pesticides. The two big cola companies insisted their locally bottled drinks met international safety standards and challenged the ban.

Copyright Agence France-Presse, 2007

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