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PepsiCo gained entry to India in 1988 by creating a joint venture with the Punjab government-
owned Punjab Agro Industrial Corporation (PAIC) and Voltas India Limited. This joint venture
marketed and sold Lehar Pepsi until 1991, the use of foreign brands was allowed; PepsiCo
ended the joint venture in 1994. Many claim that Pepsi was banned in India, in 1970, for having
refused to release the list of its ingredients and in 1993, the ban was lifted, with Pepsi arriving on
the market shortly afterwards. [6]

In 2003, the Centre for Science and Environment (CSE), a non-governmental organization in
New Delhi, said aerated waters produced by soft drinks manufacturers in India, including
multinational giants PepsiCo and The Coca-Cola Company, contained toxins, including lindane,
DDT, that can contribute to cancer, a breakdown of the immune system and cause birth defects.

The Coca-Cola Company and PepsiCo angrily denied allegations that their products
manufactured in India contained toxin levels far above the norms permitted in the developed
world. An Indian parliamentary committee, in 2004, backed up CSE's findings and a
government-appointed committee, tried to develop the world's first pesticides standards for soft
drinks. Coke and PepsiCo opposed the move, arguing that lab tests aren't reliable enough to
detect minute traces of pesticides in complex drinks.

These controversies are a reminder of "India's sometimes acrimonious relationship with huge
multinational companies." Indeed, some argue that PepsiCo and The Coca-Cola Company have
"been major targets because they are well-known foreign companies that draw plenty of
attention."



c

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As of 2005, The Coca-Cola Company and PepsiCo together hold 95% market share of soft-drink
sales in India. [8] PepsiCo has also been accused by the Puthussery panchayat in the Palakkad
district in Kerala, India, of practicing "water piracy" due to its role in exploitation of ground
water resources resulting in scarcity of drinking water for the panchayat's residents, who have
been pressuring the government to close down the PepsiCo unit in the village.[9]

In 2006, the CSE again found that soda drinks, including both Pepsi and Coca-Cola, had high
levels of pesticides in their drinks. Both PepsiCo and The Coca-Cola Company maintain that
their drinks are safe for consumption and have published newspaper advertisements that say
pesticide levels in their products are less than those in other foods such as tea, fruit and dairy
products.[10] In the Indian state of Kerala, sale and production of Pepsi-Cola, along with other
soft drinks, was banned by the state government in 2006[11], but this was reversed by the Kerala
High Court merely a month later.[12] Five other Indian states have announced partial bans on the
drinks in schools, colleges and hospitals.[13]

c
 

‡ 6 August 2003 ± The Delhi based Center for Science and Environment (CSE) reveals that it has
conducted a study on samples of 12 major soft drink brands sold in the country for the residual
levels of pesticides and found the levels to be far too high when compared with the same in the
samples from developed countries.

‡ 6 August 2003 ± Both the Cola giants join hands when faced with adversity. The PepsiCo India
holding chairman Rajiv Bakshi assures that the company¶s products are of highest quality and
conform to very stringent standards set by ³independent accredited laboratories´. He expresses
the opinion that the company is open for inspection by ³an independent accredited authority
comprising experienced people´

‡ 7 August 2003 ± Pepsi India comes up with a press release stating that all Pepsi products
conform to the most stringent of quality standards world over. The regular testing and stringency
norms at Pepsi, it seems, require the most sophisticated and specialized tests and equipment to be
able to detect the pesticide residue at 0.1 parts per billion levels. Moreover, CSE is not a
government accredited body certified for the capability of carrying any such tests, says the press
release. The press release also cites the name of ³an independent world-class laboratory´ ±
VIMTA, which was accredited by the National Accreditation Board for Testing & Calibration
for Laboratories (NABL), as having tested the Pepsi products against several stringent norms.
Mutual mudslinging begins as the company openly questions the credibility of the tests done by
CSE and its capability in conducting such tests.

‡ 10 August 2003 ± While the Cola giants stick to their story of CSE¶s claims to be incorrect,
CSE reiterates that the soft drink majors follow double standards with the samples from US
containing no pesticides, whereas the samples from Indian plants contain 30 to 35 times more
than the acceptable levels of pesticide residues stipulated by European Economic Community
(EEC). The Cola giants start contemplating legal action in the wake of steep fall in sales.

c


‡ 22 August 2003 ± Union Health minister Sushma Swaraj issues statement that only three
samples out of the 12 in the contention meet the EEC norms; while the other samples have
residue levels above the acceptable limits, they are only 2 to 6 times more than the acceptable
level unlike 30 to 35 times as claimed by the CSE; This has been the result of tests conducted by
two laboratories, the Mysore-based Central Food Technological Research Institute (CFTRI) and
the Kolkata-based Central Food Laboratory (CFL).

‡ 23 August 2003 ± The government appoints a 15-member all party Joint Parliamentary
Committee under the leadership of Sharad Pawar to delve into the issue and submit a report on
the same in the next session. The committee is also expected to suggest the safety standards for
pesticide residue levels in soft drinks, fruit juices and other beverages that have water as the
main ingredient.

‡ February 2004 ± The JPC submits its report to the parliament, saying that the tests conducted
by CSE are accurate and India needs to come up with a set of standards for carbonated
beverages. Central Committee on Food Standards (CCFS) endorses the JPC report and says it
will set final standards. Bureau of Indian Standards (BIS) also starts revising its standards.

‡ June 2004 ± Pesticide Residue Sub-Committee of CCFS meets and decides to do year-long
monitoring.

‡ November 2004 ± CCFS meets and decides to set up National Expert Committee to study the
matter.


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‡ 8 August 2006 ± Four states ± Gujarat, Madhya Pradesh, Rajasthan and Chattisgarh ban the
sale of Coke and Pepsi in the educational and governmental institutions. The ban is a
consequence of CSE¶s report stating that even now, the pesticide levels in these drinks are more
than 24 times above the limits set by BIS. While the top management of both the companies
insists that their products adhere to the most stringent norms and are safe for consumption, CSE
toughens its stand that the Cola companies are misleading the general public and have a long
way to go before actually meeting those safety norms.

‡ 10 August 2006 ± Kerala announces a complete ban on production and sale of carbonated soft
drinks, including Coca-Cola and Pepsi, while Karnataka announces a ban on sale of colas in
schools and state-run hospitals.

‡ 14 August 2006 ± PepsiCo India Chairman Rajeev Bakshi reiterates that the company¶s
products in India are as safe as anywhere else in the world. He expresses the company¶s
willingness to support the government in setting up criteria for pesticide residues in soft drinks,
but insists that a protocol for testing has to be developed, which is not to stall notification of BIS
norms, but a measure to ensure that the testing procedure is validated by series of labs in India
and the world over.

‡ 22 August 2006 ± The expert committee constituted by union health minister Anubumani
Ramadoss quashes the CSE¶s report on pesticide residue levels stating that the experiment
methodology has lot of flaws in it right from sampling to reporting the residue levels


c
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"
‡ 22 September 2006 ± The Kerala High Court quashes the government¶s ban on production and
sale of the Colas in the state. The state government is exploring other alternatives.

‡ 10 January 2007 ± Pepsi India Holding chairman Rajeev Bakshi exits Indian operations.

‡ 16 February 2007 ± The apex court accepts the appeal of Kerala state government against the
High Court judgment quashing the ban on production and sale of Coca-Cola and Pepsi in the
state.


c
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22 August 2006 ± The expert committee constituted by union health minister Anubumani
Ramadoss quashes the CSE¶s report on pesticide residue levels stating that the experiment
methodology has lot of flaws in it right from sampling to reporting the residue levels.

‡ 22 September 2006 ± The Kerala High Court quashes the government¶s ban on production and
sale of the Colas in the state. The state government is exploring other alternatives.

‡ 10 January 2007 ± Pepsi India Holding chairman Rajeev Bakshi exits Indian operations.

‡ 16 February 2007 ± The apex court accepts the appeal of Kerala state government against the
High Court judgment quashing the ban on production and sale of Coca-Cola and Pepsi in the
state.

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