Genetically Modified Crops in India - Role of Asymmetric Information

Today the debate about the Genetically Modified Crops is very active and highly inflammable due to its inherent political nature. Any policy, which neglects political factors by giving only weight to scientific factors, will end up in market failure for these products. The intense debate about this food is mainly due to its lack of proper information. Though asymmetric information is playing a vital role in penetration of these crops, very few studies have gone into studying this aspect. It seems that India's policies towards GM crops are at crossroads and they are not able to view this problem in a particular way. They are not able to understand the crux of the whole problem. They are simply saying whatever is good for the US is good for India. This lack of visionary towards these crops are plunging the country into not to take any decision of their own. For Biotech companies success in the world's largest democracy will be seen as public acceptance and increases MNC credibility. If we analyze the problem prevailing in India we can see that it is more of asymmetrical information rather than any other problem. This asymmetry is prevailing as there is many actors are involved on these issues and they pass on asymmetric information to the beneficiaries (farmers/consumers). The whole issue related to these crops is fully asymmetrical through out the supply chain. So in this article talk of asymmetric information problem and we see how it is affecting outcomes. If the asymmetric information as talked by classical Akerlof model is existent then the problem will be persistent. The silence to the most of the genuine questions posed by these GM Foods would postpone a sustainable development and the judicious application of the biotechnology