The Indian subsidiaries of U.S. cola giants Coca-Cola Inc. and Pepsico Inc. filed suits recently in the India's Kerala High Court challenging a ban by the government of the southern state on manufacturing and selling soft drinks.

The Indian subsidiaries of U.S. cola giants Coca-Cola Inc. and Pepsico Inc. filed suits recently in the India's Kerala High Court challenging a ban by the government of the southern state on manufacturing and selling soft drinks. The two companies have asked the Kerala High Court to overturn bans ordered by the state government and by the state's director of health services. Kerala had announced the blanket ban--the first by an Indian state--on Aug. 9, a week after an environmental group alleged that the soft drinks contained harmful amounts of pesticides. At least half a dozen other large states have restricted sales by banning drinks made by Coca-Cola and Pepsico in schools, colleges, hospitals, and some government offices. Meanwhile, authorities in the state of Karnataka, which borders Kerala, said they had filed a case against Coca-Cola in a local court after finding high pesticide levels in the company's beverages in tests conducted by a private laboratory. The state government filed charges under the Prevention of Food Adulteration Act 1954, the state's health minister R. Ashok said. Coke and Pepsi, which control almost the entire Indian market for soft drinks, have rejected the charges. They say drinks sold in India are as safe as those sold anywhere in the world. While Kerala accounts for a negligible part of soft drink sales, the total ban by state authorities has attracted widespread attention. Indian industry groups have urged state governments to first conduct their own safety tests instead of straightaway banning Coke and Pepsi beverages. They say failure to do so will hurt India's overseas image as a law-abiding country.