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GoM has failed to hold Dow's feet to the fire

By Praful Bidwai
June 25, 2010 18:40 IST
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The entire effort to artificially bury the Bhopal legacy is misguided. Unfortunately, the legacy lives on. Justice demands that it is brought to an honourable, dignified closure in a fair and transparent manner. The Group of Ministers has failed to do that, writes Praful Bidwai.

The contrast between BP's response to the outrage over the oil spill in the US and Union Carbide Corporation's attitude to the uproar over the Bhopal disaster couldn't have been sharper. Confronted by a furious public and a President, who vows to make it pay every penny lost by US citizens, BP has pledged $20 billion (Rs 95,000 crore) in initial remediation. It is mobilising another $50 billion although under a law similar to our own nuclear liability Bill, BP's legal liability is only $75 million. As a symbolic gesture, BP also skipped its annual dividend payment.

Carbide didn't even bother to make a minor gesture. It knew that it would get away with a pittance -- $470 million, barely more than its insurance cover plus interest. It didn't have to liquidate a large chunk of its assets to extinguish its liability for the world's greatest industrial disaster.

The spill's human toll (11 deaths) is tiny beside Bhopal's, although the impact on fisheries and the environment will be enormous. But BP's bosses are in trouble. Its chairman Carl-Henric Svanberg had to apologise repeatedly for referring to those hurt by the spill as "small people" -- fisherfolk and petty businessmen. When CEO Tony Hayward attended a yacht race at the height of the crisis, White House Chief of Staff Rahm Emanuel attacked him scathingly, warning him that he had made 'a mistake and it is a big mistake'. Potentially, Hayward could be bankrupted and could spend years in jail.

Warren Anderson had no such worries. When he visited India, he was assured of safe passage and an audience with the high and mighty. The Madhya Pradesh government arrested him. The Centre ordered it to release him and fly him to Delhi in a state plane. Why, Anderson had a meeting not just with Foreign Secretary MK Rasgotra, but also with the President of India. He certainly knew the government wouldn't serve him an arrest warrant issued by its own courts.

In the US, corporations and politicians are straining to align themselves with strong anti-BP public opinion. Pro-oil industry Texas Congressman Joe Barton did not. He attacked the government for asking BP to pay $20 billion into a 'slush fund'. His comments offended even the Republicans. He had to apologise.

In India, there has been a thundering silence on the part of companies and industry associations on the June 7 Bhopal judgment. Worse, some business leaders, including HDFC chairman Deepak Parekh -- one of our best-regarded executives -- criticised it as being excessively harsh on directors. Parekh warned that making directors culpable would scare them away from companies.

Parekh doesn't, or doesn't want to, comprehend the notion of strict or no-fault liability. Negligence, which causes public harm, can only be deterred if it is severely punished. Directors are liable by virtue of being decision-makers even if they aren't personally responsible for every design detail or operational hazard. Their culpability would be greater -- as in Bhopal -- if they have prior knowledge of the hazards. Keshub Mahindra, like Anderson, clearly knew MIC's potential for fatal accidents. These had occurred before December 1984.

The difference between the US and India is not that the American legal system or government is pro-people, but that India's legal system is institutionally flawed -- with an unaccountable self-appointing higher judiciary -- and has never developed instruments for punishing corporate crimes.

The Indian establishment is cravenly pro-rich, pro-corporate and pro-American. There are Bartons in high places in India. They inherit a colonial State structure that is supremely indifferent to the people.

So, the government, shamed by public outrage, did well to reconstitute the Group of Ministers on Bhopal albeit with a questionable composition. On the positive side are its recommendations for a curative petition on the latest judgment and the 1989 settlement; securing Anderson's extradition; and speeding up the case against Carbide's successor, Dow Chemical, in the Madhya Pradesh High Court. On the negative side are its silence on Dow's liability and its paltry recommendations for compensation to the victims.

A curative petition asking the Supreme Court to modify its 1996 order downgrading criminal charges against UCC, Carbide's fully owned subsidiary Union Carbide Eastern and UCIL, and their directors, is welcome. But this should not stop at restoring the charge of culpable homicide.

Section 300 of the Indian Penal Code defines murders of different types. Subsection 4 describes one: 'If the person committing the act knows that it is so imminently dangerous that it must, in all probability, cause death or such bodily injury as is likely to cause death, and commits such act without any excuse for incurring the risk of causing deathÂ…'

Carbide indisputably committed such acts-operating an unsafe, poorly designed plant and shutting down the MIC tank refrigeration unit, a critical safety measure-which, it knew, would lead to large-scale fatalities. It knew from a 1982 safety audit that the plant had 30 major flaws. Its pipeline design was faulty, and would permit ingress into tanks containing super-volatile, extremely reactive MIC. Logically, the accused must be re-tried for murder.

Yet, Anderson, UCC and UCE were not even tried because they absconded. This violates a condition stipulated in Judge Keenan's order, which sent the case back to India-namely, they would stand trial in India and abide by an Indian judgment. Not only does this warrant Anderson's extradition; it allows India to press fresh charges in the US, including contempt of court. This must be done expeditiously even as the extradition proceedings are sincerely resumed.

The 1989 compensation award was deeply flawed both on amount and coverage. It was based on the assumption of 3,000 deaths. But the official death toll is five times higher and the number injured 10 times greater. The maximum compensation for death, Rs 5 lakh, was paid to nobody. The average was Rs 1 lakh -- a travesty given that death in rail accidents and natural disasters is compensated at higher rates.

In Bhopal, the number of significantly injured people was about 2 lakh, but 5.74 lakh were given compensation, diluting its magnitude for the seriously-affected to a point where it could not even pay for their treatment, leave alone damages for suffering or disability. The victims' categorisation was arbitrary. Over 92 per cent were categorised as having "minor" injuries. Another 6.8 per cent were declared suffering "temporary partial disablement". Only a minuscule 3,241 cases (0.7 per cent) had injuries of the "utmost severity". This contradicts Indian Council of Medical Research surveys.

The GoM has proposed, and the Cabinet has approved, enhanced compensation, which may look impressive. But it is paltry, even mean. It will cover only 42,208 people and exclude 91 per cent of those affected. This is grossly unjust and lets down the victims.

Bhopal needs a high-level Empowered Commission, including medical and rehabilitation experts, NGOs, and the victims' representatives, which organises adequate compensation and medical treatment. This was agreed to by the previous GoM in 2008, but is not even mentioned in the new report. New facilities must be established to ensure that the victims can live with dignity and freedom from pain and humiliation. These must be staffed by competent and sensitive professionals, who understand the need to rebuild lives in their entirety. The GoM is silent on this.

Equally disappointing, the GoM is silent on whether Dow is liable for the contamination of land and water caused by Carbide because it does not own the Bhopal plant. What matters is not the present ownership but the indisputable fact that Carbide created a liability over and above the accident through the contamination. It was aware of its likely effects because it conducted numerous surveys of the site, including one in 1989.

By natural justice principles, a successor company inherits both the assets and liabilities-physical, financial and legal-of the corporation it purchases. Dow is clearly obliged to clean up the plant site and compensate the 30,000 people who are forced to drink the polluted water and suffer the consequences of the site's flooding during the monsoons.

Dow has lobbied the government to evade this responsibility. Its chairman, Andrew Liveris has twice met Prime Minister Manmohan Singh. He has also pressed his nefarious case through Messrs Ratan Tata, Home Minister P Chidambaram, Planning Commission chief Montek Singh Ahluwalia and Road Transport and Highways Minister Kamal Nath, besides industry associations. Dow must be compelled to fulfill its obligations. There's no case whatsoever for other agencies, leave alone the public, to foot the clean-up bill.

It is imperative to hold Dow's feet to the fire. If the government presses charges against Carbide in the US for violating Judge Keenan's conditions, the issue of liability will inevitably arise. That must be settled now. The entire effort to artificially bury the Bhopal legacy is misguided. Unfortunately, the legacy lives on. Justice demands that it is brought to an honourable, dignified closure in a fair and transparent manner. The GoM has failed to do that.
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Praful Bidwai