There's more to life than colas, even allegedly poisoned ones. Ergo, this article isn't about the Centre for Science and Environment's claim that 12 of India's leading soft-drink brands contain pesticides. Not too long ago, the same Delhi-based Non-Governmental Organisation had claimed that most brands of bottled water sold in India were laden with pesticides, a report that seems to have sunk without a trace-unlike, if the NGO's report is to be believed, pesticides in cola.

Indians are no strangers to poison in their food. India's Green Revolution was built around the excessive use of pesticides and fertilisers, largely by farmers who didn't have the time, inclination, or ability to read the small print. That continues to this day, a situation exacerbated by inadequately trained agricultural extension officers (some 1.2 million at last count)-government employees whose job it is to guide agriculturists on the usage of agrochemicals. Thus, although the average use of pesticides in India, at 0.57 kg a hectare is less than comparable figures for the US and Europe (2.5-3 kg a hectare), a 1999 study by the All India Co-ordinated Research Project on Pesticides (AICRP) showed that 60 per cent of food commodities were contaminated with pesticides, 14 per cent, over the maximum limits of tolerance. As S.P. Vasireddi, the Chairman and Managing Director of the Hyderabad-based Vimta Labs-the company was in the news recently because of PepsiCo India's claim that it was one of few accredited labs in India with the expertise to test soft drinks-puts it, there are "pesticides along our entire food chain".

Emboldened by the absence of guidelines on food standards and the government's track record on issues related to contamination-CSE's bottled water report, for instance, has resulted in no tangible government action-businesses, big, small, and individual, continue to deal in contaminated products or worse, contaminate them. Vendors routinely use green dye to make their vegetables look fresher than they really are. Some cosmetics contain lead. The mango trade in Tamil Nadu and Andhra Pradesh uses calcium carbide, a highly toxic material, to accelerate the ripening process. And everyday, some 60,000 litres of Erode milk (named after its place of origin, a Tamil Nadu town) is sold in Bangalore and Mysore; it retails for Rs 5 a litre, almost 70 per cent lower than market rates, and contains chemicals such as caustic soda and urea. "The Prevention of Food Adulteration Act (1958) in its current form can't be applied to unbranded foods," says Ravi Agarwal, Director, Toxics Link, a Delhi-based NGO.

Getting the government to frame an effective pesticide management policy, revamp the PFA Act, and define food standards is one thing, and probably the best long-term solution to poison in our food. However, activism like CSE's could, if backed by scientific evidence, serve as the basis for individuals seeking recompense from private companies that knowingly sell products containing contaminants. More reports like CSE's may well spur Indian consumers to do that. A class action suit or two could force companies to be a little more careful about their products. ''In India, cases against private companies for compensation are (usually) time consuming,'' says Anand Pathak, Partner at the Delhi-based P&A Law Offices. However, a judgment ordering a Delhi theatre owner to compensate the families of those who died in a 1997 fire may set a precedent

Rising concern over contamination may also provide a platform for companies to position their products as 'pure' (provided they are that, of course), and charge a premium. According to Santosh Desai, President, McCann Erickson, the strategy may pay off "in a negative way". Companies that wish to adopt such a strategy would do well by praying (or paying) for more independent research into food-contaminants.

-with additional reporting by Nitya Varadarajan, Venkatesha Babu, E. Kumar Sharma

Sniffing For Scams
Only the paranoid regulate.

Blame it on d-street history: Every boom has either been caused by, or engendered in turn, a scam. The 1992 bull-run was cut short by the Harshad Mehta scam. The IPO boom of 1994 ended with l'affaire M.S. Shoes. And it emerged that Ketan Parekh was behind 2001's stockmarket revival. Attribute it to a bunch of trigger-happy Parliamentarians that blamed everyone for the 2001 scam. In its report, the Joint Parliamentary Committee said that the 2001 scam could have been avoided if someone had sought to find out whether the stockmarket rally was based on fundamentals or not.

So, when Bombay Stock Exchange's Sensex crossed the 3700-mark recently, the result of a fairly steep upward climb, the ministry of finance lost no time in asking India's stockmarket watchdog, Securities and Exchange Board of India (SEBI) to investigate just that (whether the rally was based on fundamentals). When the markets turned volatile in early August, SEBI's surveillance system moved into overdrive, scanning the market for any unusual activity. And courtesy a recent directive, banks are now required to provide details of their exposure to the capital market to the Reserve Bank of India, every two months. They could get by doing so twice a year in the past, but RBI is justified in its action-banks were involved in the 1992 and 2001 scams.

Thus far, the investigations have turned up nothing. But as Susan Modeski, a character in the paranormal-conspiracy-theory series X-files puts it, "No matter how paranoid you are, you aren't paranoid enough". Keep sniffing gentlemen.

-Roshni Jayakar

Kicking The Tyres
Maruti shows a better way to buy and sell used cars.

Maruti's Second Line: It's becoming stronger

If you think the second-hand car market is the exclusive preserve of roadside touts and the Sunday classifieds, think again. Mercedes-Benz has been selling second-hand (or to use the company's more politically correct term, 'pre- owned') vehicles in India for some time now. Several other companies, including General Motors India and Ford have entered the refurbished-and-certified used car market. And Maruti True Value-Maruti Udyog's used car foray, launched in October 2001-sold over 1,000 vehicles in July, a sign of the market's growing maturity (and size). Today, there are 87 True Value outlets across 61 cities, and Maruti is encouraging more dealers to jump on to the used cars bandwagon.

Car makers believe that for every three new cars sold in India, an used one changes hands, a rule-of-thumb that puts the size of the Indian used car market at 250,000 units a year. ''Under the programme, sellers benefit from a 120-point evaluation, an assured price for their vehicle, prompt payment, and the guarantee that the car will go to a bona-fide buyer,'' says a Maruti spokesperson. And the company's CEO Jagdish Khattar is confident that with several of the four million Marutis on Indian roads set to change hands, Maruti has a huge opportunity that it can't possibly mess up. That's an accurate assessment: the company makes money on parts, the dealer earns a commission, and the customer ends up with a good buy. Maruti's success may persuade other companies to up a gear; 2,50,000 cars is just too good an opportunity to pass up.

-Kushan Mitra

THE BT 50 INDEX
India's first free float index is up 30 per cent since April 1. How close are we to a bull-run?

Even as the stockmarket continues its northward journey, we felt it was time to review the BT 50 Index. Purists may baulk at revising an index a mere three months after it was launched (it first made an appearance in the issue of Business Today dated April 13, 2003). It is accepted practice to review indices every quarter; Bombay Stock Exchange and National Stock Exchange do so. Neither of the two exchanges, however, effects an actual change in its index on a quarterly basis. We are of the belief that indices should reflect market reality and that as listings, delistings, and mergers become commonplace, they should change frequently enough to remain an accurate weathervane. Which is why we have included Bharti Televentures in BT50 (the company was listed on February 18, 2002, after the base-date of the BT index, January 1, 2002). It takes the place of Britannia Industries, the company with the lowest free-float market capitalisation (the market value of all the shares of the company available for trading) on June 30, 2003. There's another reason why BT50 has to change every quarter. Companies declare their shareholding pattern at the end of every quarter. This reveals the latest free-float position of a company's scrip. For instance, the free float in BSEs has decreased from 55.89 per cent to 41.76 per cent in the last quarter. BT50 being a free-float index, a quarterly revision in weights becomes necessary. These changes have been carried out and are effective from August 1. Why free float? Well, as we've mentioned in this column such an index is far more responsive to a market uptrend or downtrend. Thus far, BT50 has led the market.

-Narendra Nathan