MON Monsanto Company (delisted)

NEW DELHI—Monsanto Co. said Thursday that it has withdrawn an application to sell a new variety of genetically modified cotton seed in India because of its concerns over the country's attempts to restrict the biotechnology business.

The decision by the global seed giant casts a cloud over the future of genetically modified organisms in India. The South Asian nation has so far blocked use of GMO for food crops, but is one of the world's biggest producers of GMO cotton, thanks largely to Monsanto's biotechnology.

The GMO cotton seeds have already helped India become one of the world's largest cotton producers and the new seeds were expected to boost productivity even further.

Monsanto raised concerns over Indian regulators limiting what the company can charge for the seeds.

Monsanto said it had notified India's Genetic Engineering Approval Committee—India's regulator of genetically modified crops—about the withdrawal of its application for the Bollguard II Roundup Ready Flex cotton seeds. It said it would continue to sell its current selection of cotton seeds in India.

Cotton remains the only GMO crop that can be grown in India. Efforts by seed companies to introduce biotech food crops such as corn and eggplant have stalled because of protests from environmental groups and bureaucratic inertia, say seed-industry officials.

India's government has long regulated the price farmers pay for cotton seeds, but new rules also regulate the royalties companies can charge other seed developers for their modified cotton-plant genes.

Monsanto and its joint-venture partner in India, Maharashtra Hybrid Seed Co., are challenging the new rules in court.

Officials at India's Ministry of Agriculture couldn't be reached for a reaction on Thursday, but previously ministry officials have said that they have been trying to put more restrictions on the industry because of Monsanto's dominance in supplying genes for biotech cotton.

Write to Biman Mukherji at biman.mukherji@wsj.com

(END) Dow Jones Newswires

August 25, 2016 07:05 ET (11:05 GMT)

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