Ignored health risks, bungled pilot projects, bonanza for Dutch firm: Modi Govt. forces fortified rice on poor


Three part series by The Reporters’ Collective: by Shreegireesh Jalihal
(Editor: Anoop George Philip, Contributors: Nitin Sethi, Tapasya, Harshitha Manwani)

On Independence Day, 2021, when Prime Minister Modi announced that over 80 crore people will be fed rice fortified with iron and vitamins to combat rising cases of anaemia and other micronutrient deficiency diseases, it was touted as a major health policy initiative. He announced that more than half of Indians would be fed rice fortified with micronutrients by 2024 to eradicate anaemia. But in haste, he served a public health policy that was raw and potentially dangerous to health.

Part 1 of the series revealed how the Narendra Modi-led Union government ordered that 80 crore Indians be fed fortified rice despite high-ranking officials and public health experts calling for wider consultations to understand the adverse effects of feeding iron-laced rice on human health, particularly that of children, before rolling out the scheme. 

Documents accessed by The Reporters’ Collective reveal that while going ahead with the decision Modi ignored the fact that the majority of pilot projects launched by his government to test the rice’s nutritional impact had not taken off at all. The government overruled the finance ministry’s red flag calling the move “premature” before understanding its impact on human health. Sacks of fortified rice were trucked out despite the head of the country’s leading medical research body calling for wider consultations following “serious concerns” on the “adverse effects” of fortified rice on children.

But Modi, unhindered by internal and external warnings, announced the government’s plan to mandatorily supply fortified rice to over  80 crore Indians, most of them poor, under all food security schemes. So far the government, to mitigate rising incidence of anaemia and micronutrient deficiency, has allocated over 137.74 lakh tonnes of fortified rice to states for beneficiaries under different welfare schemes.

Read part one here: Modi gov’t ignores internal red flags on health risks to force fortified rice on poor

The Union government’s apex think tank NITI Aayog found the Modi government bungled its pilot projects designed to collect crucial scientific evidence on the impact of fortified rice on citizens’ health. It wrote a confidential report, which was never made public. The Collective is now revealing the findings of the report. The government has so far allocated over 137.74 lakh tonnes of fortified rice across all states. Part 2 of the series revealed how government officials flagged shoddy implementation of the scheme eight months after the Prime Minister announced it.

Once the orders to make fortified rice mandatory for all central government food security schemes had been passed, NITI Aayog decided to study how “prepared the ecosystem” was to ensure the supply of fortified rice and what “bottlenecks existed before the programme.”

But, what it found was damning. None of the pilot projects that NITI Aayog reviewed had carried out the basic, but most essential, surveys to map the existing levels of micronutrient deficiency in the district population before forcing them to consume the fortified rice for a year. In other words, the pilots were fundamentally flawed and incapable of assessing the safety and efficacy of fortified rice. 

It also found that the pilots were marred by patchy responses by states, botched quality control, lax scientific parameters, and shoddy supervision. The report reveals how Aayog’s officials found quality checks missing despite India’s food safety regulator listing fortified rice kernels – grains of rice laced with micronutrients – under its ‘high risk’ category. Food items categorised as high risk are to be inspected carefully and are dangerous for public health when not well-produced.

The report, marked confidential, did not matter much anyway. After Prime Minister Narendra Modi’s grand announcement in August 2021 to universalise fortified rice and the government’s subsequent rollout of a programme in April 2022 following up on the Prime Minister’s announcement, the report’s findings on the failed pilot projects had no takers. 

Read part two here: Confidential NITI Aayog Report Reveals Centre Bungled Rice Fortification Pilot Projects

Read Part Three: A bevy of international organisations were part of a government resource centre that chalked up policy on rice fortification. All of them have links to Dutch multinational, Royal DSM, which benefits from the assured market created by the government’s decision

A Bonanza For Dutch Firm:  Modi’s Decision Forcing Half of India to Eat Fortified Rice

In this final part of the series, we reveal, how at least six international organisations, found their way into an Indian government agency to influence decisions and open the Indian market to global suppliers and manufacturers of premixes that are used to produce the artificial fortified rice kernel (Fortified rice is made by beating grains into a dough, adding micronutrients or premix to it and then machine-carving the dough into grains that resemble rice). One such kernel is mixed blended with 100 natural rice grains.– an annual business opportunity of Rs 1,800 crore created solely by Union government’s mandate.

The Collective’s investigation found, all the six organisations are linked to one company based in The Netherlands. Royal DSM NV, one of the world’s most prominent producers of fortified rice premix. DSM claims to be a health and nutrition company. It produces the powder used in fortification. The firm, The Collective found, funds one of the six organisations, collaborates with another, sits on the advisory board of third and partners with the rest. 

These six organisations influenced government policy on supplying rice and other food items fortified with micronutrients across the country, collected evidence to buttress the case for fortification, ran pilot projects with governments, worked to set standards and charted countrywide rollout. The government used ‘science’ generated by these organisations to justify mandatory supply of fortified rice in India. The government guidelines on fortification were developed by plagiarising in parts verbatim from toolkits developed by some of these organisations.

In return Modi’s announcement gave a bonanza to Royal DSM. 

The company did not hide its gratitude. “We are very thankful that Prime Minister Modi’s government has mandated the fortification of rice, at least in the social safety nets part of the rice pipeline in India,” François Scheffler, Regional Vice-President, Human Nutrition and Care, Asia Pacific & President, DSM Asia Pacific told the Indian media.

The Collective’s evidence gathered is based on internal government records as well as public documents.

Screengrab of the interview with a top DSM executive.

Within eighteen months of Modi’s announcement Royal DSM set up a 3,600-tonne capacity fortified rice kernel plant in Hyderabad. Scheffler told The Print that Royal DSM is working with the government, NGOs and rice millers in India to expand its production.

DSM is estimated to have already cornered 17% of the Indian micronutrient premix market, says market research agency Giract. The domestic market was estimated to be worth over Rs 660 crore in 2021. And, soon it would be worth Rs 1,800 crore a year, thanks to the Union government’s mandate.

While DSM is open about its business strategy involving nonprofits and engagement with governments, it’s not the only corporate that would stand to gain significantly from the government’s decision. Neither is their modus operandi unique. Many global companies in the business of food and nutrition products lobby through nonprofits and directly to create markets in the developing world.

A Meeting In Mexico

The idea to rapidly “rally” nonprofits and corporates to push rice fortification in developing countries was crystallised  way back in 2016 in Cancun, Mexico. International nonprofits congregated to attend a symposium on rice fortification organised by DSM and some global NGOs. The agenda on the table was a grand one: “Create a movement that will deliver a global roadmap for scaling up rice fortification”. 

One of the speakers, the current president of nonprofit group Nutrition International, Joel Spicer, said at the symposium, “The policy advocacy piece is missing from the rice fortification agenda. We need to communicate with the governments’ policy-makers — and establish how much the scale-up of rice fortification will cost, what they will get from it, and who’s going to pay for it.”

A month after the conference, the food safety regulator of India, Food Safety and Standards Authority of India, set up a ‘resource hub’ geared specifically towards fortification. One can only guess if it was a mere coincidence or not. The Food Fortification Resource Centre, as it came to be called, planned ‘alignment and advocacy’ and worked towards ‘creating demand’ for fortification.

These are business terms to describe the act of convincing governments to make it a must for people to consume such food products. Indian and international food product companies have always eyed the Union government’s vast food security schemes serving more than 80 crore people in India. In 2016, the fortified food producers set their sights on this Indian market.   

A bevy of international nonprofits, including Nutrition International and one previously owned and still funded by DSM, became partners in the resource centre, which works as the government’s nodal arm for fortification and is dependent on nonprofits for every aspect of its functioning. They attended meetings on fortification, and were invited to major government policy meetings, thus playing a major role in lobbying for food fortification with lawmakers in India.

When the resource centre released the primary document that sketched out the plan for fortification in 2017, it listed nutrition nonprofit  Sight and Life as one of the government’s partners in scaling up fortification across the country. Sight and Life previously operated ‘under the umbrella’ of DSM and continues to be funded ‘generously’ by the firm. While the nonprofit claims it is an ‘independent foundation’, half its board members, including the chair of the board of trustees, are DSM personnel. As a partner, the nonprofit  would be involved in setting policies and even have a say in notifying the food regulator’s standards for fortifying rice. 

The 2017 document calls for a joint advocacy campaign led by FSSAI – “bringing the credibility, authenticity and trust of the government” – but adds, “with financial contributions from the industry and premix suppliers”.

While the government was still chalking out plans to scale up the fortification programme, the food regulator held a meeting with the premix industry in March 2017. The minutes of the meeting recognise DSM as the only premix supplier for rice fortification. In the meeting, the firms decided on a price range for both premix manufacturing and fortified rice kernels. “FSSAI does not fix any market price of any food commodity,” said the government’s food regulator over mail. However, the minutes of the meeting clearly show each premix supplier enumerating the price range of the premix they offer. 

Experts say the fact that the resource centre is intertwined with nonprofits funded by firms with commercial interests in the fortification policy raises ethical questions about its functioning.

“Having the Food Fortification Resource Centre in FSSAI requires investigation about its role,” Dr Arun Gupta, a paediatrician and convenor of Alliance Against Conflict of Interest, told The Collective over mail. 

“The majority of FFRC partners are funded by the food industry, why on earth should they be asked to play the role of a resource centre?”

“FSSAI invites various stakeholders to attend meetings for better understanding. However they do not have any role to decide policy matters etc,” the FSSAI told The Collective via mail in response to detailed queries.

None of the meetings on fortification in the files The Collective reviewed, however, involved civil society or consumer groups not linked to food businesses. This was a departure from the meetings held, for example, on the contentious issue of the government’s Front of Pack Labelling policy, which involved a more diverse set of stakeholders. 

Pratima Munda of Kuchiyasholi, Jharkhand, holds a plate of fortified rice served under mid-day meal scheme to children in the village. Photo: Shreegireesh Jalihal

DSM has nurtured allies in NGOs, and governments to promote fortification, and is open about it. “In partnership with governments, the private sector and NGOs such as GAIN, DSM is pioneering the establishment of staple food fortification programs worldwide,” it says on its website. 

By now the signs of the government’s growing chumminess with DSM became apparent. The Modi government finalised India’s fortification policy despite overwhelming evidence pointing towards its lack of efficacy. But internally, it cherry picked a list of evidence to convince states to start supplying fortified rice. One of the research papers cited as evidence on this list is by Sight and Life – the nonprofit previously functioning under DSM – and DSM itself. The DSM-affiliated research concluded that fortified rice is an effective way to combat malnutrition. The resource centre website too, cites multiple studies by Sight and Life.

DSM being the early bird was positioned to reap profits. Government tenders for picking fortified rice kernel suppliers list eight premix suppliers allowed – one of them was DSM. The government’s fortification resource centre lists DSM’s Indian group company, DSM Nutritional Products India Pvt Ltd, as a supplier of both fortified rice kernels and centrally licensed premix.

The government’s fortified rice programme has coincided with the healthy growth of DSM’s revenue. DSM Nutritional Products India’s profits after tax saw a near 30% hike in the financial year 2021-22 over its 2020-21 numbers. The 2020-21 year was also a great one for the firm with a 60.5% rise in profit after tax when compared to 2019-20. In fact, the company’s profit of Rs 20.65 crore in 2021-22 is the best figure it has posted so far, shows a review of the company’s corporate filings. The company’s annual filings, however, do not segregate its revenues based on sale of particular products.

The Collective sent detailed queries to DSM. A spokesperson on behalf of the multinational got in touch with The Collective and assured that the company would respond to the questions. But no reply came through.

Financial welfare of business corporations was on the government’s mind too. Though rice fortification was touted as a health move, government documents reveal an underlying aim to foster the wealth of businesses. The Food Department in a note, dated 12 September 2019, said one of the objectives of its rice fortification scheme was to “give a fillip to the FRK (fortified rice kernel) industry through assured demand”.

Screengrab of the Food Department’s September 2019 correspondence.

The industry includes those who produce micronutrients, units that manufacture machines to mix rice with nutrient powders to make fortified kernels, machines that blend these kernels with normal rice in the right proportion, rice millers and suppliers. 

Calculations by The Collective, based on figures included in official documents, show that under the scheme the business generated for the blending industry alone would be between Rs 1,560 crore and Rs 13,500 crore depending on the type of blending units millers opt for. For the kernel supply industry, meanwhile, a market totalling at least Rs 1,800 crore a year would be generated. This in addition to the market created for multinational micronutrient companies.

Fortifying Profits

At least six partners of the Food Fortification Resource Centre have indirect links to the DSM. One of them, Nutrition International, until as recently as December 2022 listed DSM as one of its private sector partners. Another partner of the Food Fortification Resource Centre is a supercluster of nonprofits. Called ‘Food Fortification Initiative’, the nonprofit is focused solely on advancing fortification as a means to mitigate malnutrition worldwide. The Food Fortification Initiative also lists DSM as one of its members.

“Food Fortification Initiative (FFI) does not endorse any premix supplier, and this includes DSM,” Food Fortification Initiative told The Collective over mail. “Premix suppliers do not influence FFI’s work globally and are not represented on FFI’s Executive Management Team.” 

The Collective found The Initiative’s Executive Management Team, however, does include Nutrition International, which has previously listed DSM as one of its private sector partners.  

And, FFI acknowledged working with premix suppliers. It said, “By working together, we achieve more than any of us could independently.”

Some of these global nonprofits partnering with the resource centre share a symbiotic relationship with DSM. 

PATH, a tech-focused public health nonprofit, has developed the technology widely deployed by developing nations for rice fortification, called Ultra Rice, its development was partly funded by DSM Nutritional Products.

Screengrab of a 2017 press note by FSSAI.  

Yet another partner of the resource centre with indirect links to DSM is the international consortium called Global Alliance for Improved Nutrition (GAIN). Its primary donor is the Bill and Melinda Gates Foundation. DSM’s president of Global Malnutrition Partnerships Mauricio Adade is on the council that advises GAIN’s board.

In 2017, GAIN’s India office informed the Indian government that the Government of the Netherlands, the home ground of Royal DSM, was funding GAIN to work on fortification in India.

GAIN isn’t just involved in lobbying for fortification. It also acts as a broker between micronutrient sellers, including DSM, and interested buyers.

In 2009, GAIN set up a ‘premix facility’ where customers can buy premix of their choice including that for rice. The facility is akin to Amazon — but just for fortification premixes. GAIN says the facility was set up to “help fortification projects by establishing an easier, more cost-effective way of procuring high quality vitamin and mineral premix”. 

A report (Read the report by ASHA here) by an Indian farmers’ welfare nonprofit Alliance for Sustainable and Holistic Agriculture on conflict of interest in India’s fortification pointed out that among the facility’s suppliers is DSM.

In response to detailed queries by The Collective, GAIN said the nonprofit did not have any partnerships with DSM in India to achieve its objectives. However, they added, “The only way to achieve this is to work together with partners (governments, businesses, and development partners) at the country and global level.”

GAIN has a history of championing corporate interests. In 2013, the World Health Organisation refused to recognise GAIN as an NGO over a business alliance network of food companies the group had set up. The alliance basically acted as an international hub to broker and lobby food deals, and offered companies assistance in lobbying for favours in targeted countries.

WHO was concerned about “the nature and extent of the alliance’s link with the global food industry”. Eventually, GAIN got recognition after scrapping its business alliance. Health activists, however, pointed out that the group co-chaired a similar business network, Scaling Up Nutrition Business Network, along with the World Food Programme.

The World Food Programme works with DSM in implementing its rice fortification programme. In its responses to The Collective’s queries about concernsof conflict of interest , it noted, “WFP has a global partnership with DSM.”  

It then added, “However, there is no formal partnership between DSM and WFP’s India Country Office. WFP in India is not receiving any funds or other resources from DSM.”

Manufacturing Evidence

In the case of the fortification policy, the line between evidence and lobbying is blurry.

Ahead of scaling up fortified food across the country, the Food and Public Distribution Department on 29 June 2021 presented research papers to the Minister of Consumer Affairs showing the efficacy of rice fortification. The department presented thirteen papers in the presentation titled “Rice Fortification with Iron, Folic Acid, Vitamin B-12”. Of these thirteen, only six studies were conducted on Indian citizens. Five of six of the India-based papers, The Collective found, were affiliated with nonprofits that are part of the resource centre and in one case directly with DSM.

The list of studies Department of Food compiled as evidence of efficacy of fortified rice included a study affiliated with DSM.

“I believe that researchers or studies supported by the food industry cannot be trusted for their findings or recommendations,” Dr Arun Gupta of the Alliance Against Conflict of Interest told The Collective.

One of the studies is a 2004-05 research paper co-authored by Dr Anura Kurpad. He is a member of NITI Aayog’s National Technical board on nutrition and professor at the St John’s Medical College, Bengaluru. His study found an increase in serum ferritin levels in children who were given iron-fortified rice. Serum ferritin is linked to an increased risk of diabetes. Dr Kurpad has been publicly warning of the risks of iron-fortified rice. 

The government has listed this paper too, as evidence of the efficacy of fortified rice. 

By 2019, the government was chalking up its centrally sponsored pilot project scheme to distribute fortified rice. Even in the development of this pilot  scheme, the Department of Food and Public Distribution worked with PATH. The government’s pilot project focused on distributing fortified rice in 15 districts. To enable this, Tata Trusts, PATH, World Food Programme and Nutrition International have been paired with states that evinced interest in the scheme as technical partners. It is unclear how they were chosen by each state to help execute the scheme.

“Today, World Food Programme (WFP) does not engage with the food fortification resource centre – WFP’s role with the entity was limited to building the capacities of the staff positioned there in the initial months,” said World Food Programme over mail.

On 15 August 2021, the Prime Minister announced that fortified rice would be supplied through the country’s PDS by 2024. Three days after the announcement, officials at the NITI Aayog began drawing up a plan to universalise rice fortification.

For this, they decided to rely on GAIN. A file noting, dated 18 August 2021, by Vedeika Shekhar, an Associate at the Niti Aayog, said, “A detailed implementation action plan will be developed for the pan India expansion of rice fortification with GAIN. GAIN has been chosen as the development partner because it has been chosen as the focal point for all the development partners by BMGF (Bill and Melinda Gates Foundation).”

NITI Aayog file noting showing government’s decision to appoint GAIN as development partner for expansion of rice fortification across India

Why should a group be chosen as India’s development partner only because the BMGF considers it their ‘focal point’ is not made clear. The role such an entity would play in the policy remains similarly unclear.

GAIN, in its response to queries by The Collective said that it is not working on rice fortification in India. But it did not respond to the question on NITI Aayog’s file notings that said GAIN has been chosen as the government’s partner in scaling up rice fortification across India. The nonprofit also did not respond to queries related to its premix facility, which procures fortified rice kernels from an Indian supplier as well. The Aayog did not respond to any queries.

Plagiarism

Here is the smoking gun to prove the government’s lack of independence in setting unbiased standards for the fortification industry. A plagiarism check run by The Collective shows the government’s fortification manual, which codifies processes to follow in rice fortification, reproduced verbatim portions of a document jointly-written by PATH and GAIN in August 2015 for their hand-outs, raising questions about the originality and independence of the government’s manual.

The slight tweaks it made included changing ‘toolkit’ to ‘hand-out’ and inserting ‘India’ once every few sentences. Then FSSAI CEO Pawan Agarwal credited PATH in the hand-out’s preface: “I appreciate the support of PATH, who has assisted in the development of this technical manual.”

The Food Department too, lifted some portions of PATH and GAIN’s toolkit for its guidelines. It patchwrote the text by erasing references to PATH’s Ultra Rice in its document. The draft guidelines, reviewed by The Collective, explicitly refer to Ultra Rice, the product PATH created partly with funding from DSM . 

In its guidelines on personnel health, for example, the manual says, “No person who is suffering from any contagious or infectious disease is permitted to enter the packing area or touch Ultra Rice.” When the guidelines were made public in 2019 the sentence was edited to: “No person who is suffering from any contagious or infectious disease is permitted to enter the packing area or touch fortified rice.”

But, all this is now history. By the end of this financial year 80 crore Indian citizens would have no option but to consume the fortified rice delivered through government schemes for survival.

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