The business of biodiversity

On March 18, 2019, the Environment Ministry (MoEF) directed the National Biodiversity Authority (NBA) to consider granting ex-post facto approval to user/accessor companies, institutes or individuals accessing Indian bio-resources or related knowledge for commercial utilisation or intellectual property.  

As per the provisions of India’s Biological Diversity (BD) Act 2002, approvals need to be sought prior to the access. By this office memorandum (OM), all those who have accessed — but not previously taken approval from the NBA as per due procedure — have been given a chance to comply with the BD Act.  

For the regulatory authority, this means regulating the access, as well as charging the access fee the government would have lost out on.

The applicants are to be granted approval on the basis of merit, as if they had applied for prior approval as required by the BD Act. This is to be done within 60 days of the OM, essentially within the term of the present government.  

This, in effect, extends the OM originally issued on September 10, 2018 by the Ministry directing the NBA to decide all cases that require their prior approval on merits and within a period of 100 days from the date of issuance of that OM.  

In pursuance of the September OM, the NBA processed 73 applications at its 48th meeting held on October 29, 2018. This was followed by 91 applications processed at its 49th meeting on November 15, 2018.  

The process resulted in either grant of approvals, as in the case of Dow Agro Sciences, Syngenta India Ltd, CSIR, MAHYCO and others or with recommendations as made to Dabur India Ltd to apply through the prescribed form. Only in one case, that of M/s Charak Pharma, was the access application (for intellectual property rights) rejected.

The logic of the BD Act is simply this: if you take Indian bio-resources and make commercial products from them, it is only ethical that you share monetary or non-monetary benefits with local people by contributing to a biodiversity fund.  

The fund is to be used for both communities and conservation. This is the access and benefit sharing (ABS) mechanism under the BD Act.

To operationalise ABS, the MoEF&CC had issued the Guidelines on Access to Biological Resources and Associated Knowledge and Benefits Sharing Regulations in 2014 (hereinafter referred to as “the ABS Regulations” for short).  

These were issued in furtherance of India’s treaty obligations under the multilateral environmental agreement – Convention on Biological Diversity (CBD) and its Nagoya Protocol. This protocol is the International Regime on ABS. The domestic ABS Regulations detailed out the rates of ABS fees payable and the percentages to be divided among the NBA, the state-level biodiversity boards (SBBs) and the local-level biodiversity management committees (BMCs).

The endeavours of the Environment Ministry to make Indian industry ABS-compliant face opposition from the AYUSH Ministry, which is focused on promoting the Ayurveda industry.  

The AYUSH industry has received much policy support. A full-fledged ministry of AYUSH was formed on November 9, 2014, under the present central government. The acronym AYUSH stands for Ayurveda, Yoga, Unani, Naturopathy, Siddha and Homeopathy.  

It was previously the Department of Indian Systems of Medicine and Homeopathy (ISM&H) created in March 1995 under the Ministry of Health and Family Welfare. The present government would like Ayurveda to be a global brand, just as with yoga.

The Confederation of Indian Industry (CII) organised a Global Summit on Ayurveda in Kerala in 2018, with a long list of ‘asks’ for support from the government. However, Ayurvedic product manufacturers do not want to be brought under any legal obligation to either share benefits with India’s local communities or make contributions to conservation.  

There have been a host of cases in various high courts by domestic AYUSH companies challenging ABS demands made on them by SBBs. The most famous of them is by Baba Ramdev’s Divya Pharmacy against the Uttarakhand SBB in the Uttarakhand High Court.

The longest-pending case is that of Central India AYUSH Drugs Manufacturers Association (CIDMA). CIDMA along with Indian enterprises, namely Aroma Herbal & Ayurvedic Industries Pvt Ltd, Vicco Laboratories, Shree Baidyanath Ayurved Bhavan Pvt Ltd, Anil Cottage Industries, Pathak Ayurvedic Pharmacy and Shivayu Ayurved Ltd, filed a writ petition before the Nagpur Bench of the Bombay High Court in December 2015 challenging the applicability of the ABS regulations to Indian entities. The matter is still pending.

The present OM has been issued under Section 48 of the BD Act. As per that legal provision, the NBA is bound by the directions of the central government (in this case MoEF&CC) on questions of policy.  

The OM makes NBA take a mild approach (requiring ABS from the 2014 Regulations onwards) as against insisting on strict compliance for all previous years of access. In fact, the BD Act imposes penalties for non-adherence with the law.  

This approach provides a way out for users/accessors. It should not mean that the NBA does away with the mandatory consultation with BMCs [under Section 41(2) of the BD Act] when taking decisions on access.  

Such an approach may help the regulators to generate some benefit sharing from access, but it may fall short of ensuring adherence to a legal process that is built on community involvement, local conservation and sustainable use.  

Author is independent legal researcher & coordinates BioDWatch on India’s bio-diversity laws implementation. Kanchi Kohli also contributed to this piece