The Coca Cola company has invested over $1 billion dollars building a market for its products in India, but the company’s welcome has been less than effervescent, considering the contentious issues raised by the company’s business practices.
The company uses thousands of liters of water every year to make its well known drink and to clean bottles and machinery. The water is drawn from wells and aquifers it shares with neighboring farmers. The water is virtually free to all users, however, in a land with a completely irrational groundwater policy (where, if you have the means and the resources, you can extract as much groundwater as you like and use as much as you want at no cost), the company ends up using most available water at the expense of its low income farmers.
The fields surrounding Coca Cola factories in India were once fertile enough to grow rice and other staples. However, since the factories have opened, the water levels have shrunk dramatically, not to mention that toxic waste-waters have changed the chemical nature of the soil. Many farmers have now become farm laborers who completely depend upon rainwater for their survival.
Following the media attention pursuant to an outcry by local farmers, Coca Cola has agreed to subsidize a sizeable portion of the cost of water-efficient drip irrigation systems for Indian farmers. The company has also set up concrete collection systems for rainwater, and Coca Cola CEO Atul Singh claims that by the end of 2009, the company will become “water-neutral,” returning at least as much groundwater as it withdraws in India.