Coca-Cola Liable for US$ 48 Million for Damages – Government Committee

For Immediate Release

India Resource Center
Contact: 

R. Ajayan, Plachimada Solidarity Committee and V. Swaminathan, Adivasi Samrakshana Sanghom +91 98471 42513
C. R. Bijoy, People's Union for Civil Liberties +91 98431 72584
Amit Srivastava, India Resource Center +91 98103 46161 +1 415 336 7584 (US)

Coca-Cola Liable for US$ 48 Million for Damages – Government Committee

NEW DELHI -   In a major development, a High
Power Committee established by the state government of Kerala in India
has recommended today that Coca-Cola be held liable for Indian Rupees 216
crore (US$ 48 million) for damages caused as a result of the company's
bottling operations in Plachimada.  

The Coca-Cola bottling plant in Plachimada has remained shut down since
March 2004 as a result of the community-led campaign in Plachimada
challenging Coca-Cola's abuse of water resources.
 

The report and recommendations were welcomed by activists who have
challenged Coca-Cola's operations in Plachimada.  Demanding
compensation from the Coca-Cola for the damages it has caused has been a
central demand of the campaign from its inception.
 

"We welcome the Committee's recommendations and now the state government
must find the political will to implement the recommendations," said R.
Ajayan of the Plachimada Solidarity Committee, a statewide organization
that has been instrumental in moving the compensation process
forward.
 

The Adivasi Samrakshana Sangham and the Plachimada Solidarity Committee
had submitted detailed proposals to the high level committee on the issue
of compensation and the course forward.
 

"The Committee thus has compelling evidence to conclude that the
HCBPL has caused serious depletion of the water resources of Plachimada,
and has severely contaminated the water and soil," said the
report
. HCBPL is the Hindustan Coca-Cola Beverages Private
Limited, a subsidiary of Atlanta based Coca-Cola Company.
 

"The Committee has come to the conclusion that the Company is
responsible for these damages and it is obligatory that they pay the
compensation to the affected people for the agricultural losses, health
problems, loss of wages, loss of educational opportunities, and the
pollution caused to the water resources," added the report.
 

The report made it clear that the numbers used in arriving at the $48
million compensation were estimates and "indicative in nature", and
"should not be treated as the outer limit of compensation."
 

Importantly, the report clarified that the compensation suggested did not
include damages as a result of water depletion caused by Coca-Cola, and
such damages must be assessed.
 

The report also agreed that Coca-Cola should be held criminally liable
for its reckless actions in Plachimada - a key demand of the campaign to
hold Coca-Cola accountable.  "The compensation is not to be viewed
as a quid pro quo for not initiating criminal charges," the report
stated.
 

The Committee has also recommended that the government create a
"dedicated adjudicating agency", such as a Claims Tribunal, to move the
process of compensation forward.  Alternatively, the report
suggested approaching the central government to set up an institutional
mechanism to process the compensation claims under the Environment
Protection Act.
 

Some activists have questioned the compensatory figure suggested by the
Committee as being too low.  

"A transparent and institutionalized process can revisit the recommended
compensation numbers to make sure that Coca-Cola pays for all the damages
it has caused," said R. Ajayan. 

Validating the long term campaign against Coca-Cola, the High Power
Committee confirmed that the Coca-Cola company had violated a number of
laws in its reckless operations, including: Water (Prevention and Control
of Pollution) Act, 1974; The Environment (Protection) Act ,1986; The
Factories Act, 1948; Hazardous Waste (Management and Handling) Rules,
1989; The SC-ST (Prevention of Atrocities) Act 1989; Indian Penal Code;
Land Utilization Order, 1967; The Kerala Ground Water (Control &
Regulation) Act, 2002; Indian Easement Act, 1882.
 

Ironically, the report confirming Coca-Cola's mismanagement of water
resources and holding the company liable for $48 million in damages comes
on World Water Day.
 

"We have attended every Coca-Cola shareholders meeting in the US since
2004 to remind Coca-Cola shareholders that the company management was
being derelict in its duties by not disclosing the real financial
liabilities the company was incurring in India," said Amit Srivastava of
the India Resource Center, an international campaigning
organization.
 

"Coca-Cola shareholders need to pay attention because the company
continues to have an atrocious record in India and communities and even
governments are not just going to sit back and take Coca-Cola's abuses.
This should serve as a wake up call," he continued, referring to other
community-led campaigns in India, most notably in Mehdiganj and Kala
Dera, where the company has destroyed water resources through over
extraction of water and pollution.

The recommendations of the High Power Committee are at

http://www.indiaresource.org/campaigns/coke/2010/hpcrecommendations.html

A list of the members of the High Power Committee is at

http://www.indiaresource.org/campaigns/coke/2010/hpcmembers.html

For more information, visit

www.IndiaResource.org

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