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The return of Union Carbide

Saturday 7 May 2005, by RAJAN SHARMA*H.

The Indian government, which has appeared to be a reluctant fighter in the legal action against Union Carbide in the Bhopal gas disaster case, now decides to buy technology from the U.S. firm for an Indian Oil Corporation plant.

OFFICIALS of the Central government were indignant over the recent decision by the United States to revoke the "business-tourist’ visa of Gujarat Chief Minister Narendra Modi to attend an event promoted by the Gujarati hotel owners’ association in that country. The decision was made pursuant to an American law that makes "any government official who was responsible for or directly carried out at any time, particularly severe violations of religious freedom, ineligible for a visa". The fact that the denial rests squarely on the accusation that Modi played a role in the events in Gujarat that resulted in the deaths of thousands of Indians in 2002 has ruffled more than a few diplomatic feathers. A Foreign Ministry spokesman conveyed India’s "deep concern and regret" over the affair to Washington and pointedly added that the denial was "uncalled for and displays lack of courtesy and sensitivity towards a constitutionally elected Chief Minister".

India, it would appear, cannot be found wanting in such matters. In fact, around the same time that the U.S. was busy revoking Modi’s visa, the Indian government was busy rolling out the red carpet for an American company responsible for causing the death of thousands of Indians and visiting illness and agony upon hundreds of thousands more. That company, of course, is Union Carbide, now a wholly owned subsidiary of Dow Chemical Company, and the primary culprit of an unprecedented catastrophe that has justly been described as the worst ever to befall a peacetime civilian population.

On a single night in December 1984, Union Carbide’s pesticide plant in Bhopal spewed out some 27 tonnes of a poisonous asphyxiating gas from a storage tank of methyl isocyanate (MIC), which killed somewhere between 3,000 and 10,000 people over the course of the next 48 hours. Hundreds of thousands were maimed, some for life, and nearly 20,000 people have died in the 20 years since that night. According to the Indian Council for Medical Research, more than 250,000 people continue to suffer from permanent disabilities and chronic ailments as a result of exposure to the gas.

Now, like the proverbial criminal returning to the scene of his crime, Union Carbide is once again poised to profit handsomely from peddling its wares in the same country upon which it visited such unparalleled death and terror, its multiple-entry visa to enter and leave as it wishes apparently still valid. Union Carbide’s principal commercial partner in the project is none other than the state-owned Indian Oil Corporation, whose Board of Directors recently approved the licensing of proprietary Union Carbide technology from its new owner, Dow Chemical, for its Mono Ethylene Glycol (MEG) unit at its naptha cracker facility in Panipat, Haryana. Union Carbide’s METEOR EO 180 catalyst-based technology for the production of MEG is licensed by Dow Chemical. It is this technology that is now proposed to be transferred to the MEG unit.

The deal comes only a few months after the 20th anniversary of the Bhopal disaster, when civil servants solemnly intoned that they would spare no effort in holding Union Carbide accountable for what it has visited upon the people of Bhopal. Would it be unreasonable to ask our elected officials and their spokesmen to acknowledge that this action is similarly "uncalled for", that it too "displays a lack of courtesy and sensitivity" towards the victims of the world’s worst industrial disaster, as citizens of what we never tire of describing as the world’s largest democracy? Or are such niceties the prerogative of wealthy foreign companies on whose behalf India’s leaders strive to create a "hospitable" investment climate?

Mani Shankar Aiyar, the Minister for Petroleum and Natural Gas, has thus far defended the deal. He should, perhaps, conduct some due diligence on the legal situation of Union Carbide and its parent company. Union Carbide is a wanted fugitive in India, where it faces criminal charges of "culpable homicide" for its role in perpetrating the Bhopal catastrophe that have remained pending since 1992, when the Bhopal District Court originally proclaimed the company an `absconder’ x or fugitive from Indian law. Dow Chemical continues to claim publicly that it "is not subject" to the criminal laws or jurisdiction of India, even as it seeks to obtain lucrative contracts with public sector companies in India.

The callousness of Union Carbide towards its victims may be gauged from the fact that the company continues to withhold medical and toxicological research on the leaked gases and chemicals even 20 years later on the grounds that this information constitutes a "trade secret". Dow Chemical, which acquired Union Carbide in February 2001, could not agree more and frankly admits that it knew of the criminal charges when it purchased the company’s outstanding stock, but that it cannot be held responsible for its outstanding liabilities. More recently, the Bhopal District Court has ordered Dow Chemical to appear before the court and show cause as to why it cannot compel its wholly owned subsidiary to face trial in the Indian courts. While this summons to Dow languishes somewhere in the files of the Ministry of External Affairs, the Ministry of Petroleum and Natural Gas is busy striking a deal with Dow Chemical to acquire Union Carbide’s technology.?

THAT, astonishingly enough, is not all. Union Carbide retained control of the Bhopal plant and its technology until at least 1994, by its own admission. During that 10-year period, the company did next to nothing to remediate the local plant site, as it was required to pursuant to its lease of the land from the State of Madhya Pradesh. The factory remains standing even today, decrepit, with thousands of tonnes of toxic waste, chemicals and unfinished pesticides lying around in the open, in crumbling warehouses or in open barrels, not to mention the more than 11 burial pits where chemicals were routinely dumped on the site. Sometime in 1992, Union Carbide approved the creation of a landfill on the site, in which nearly 2,500 tonnes of highly toxic waste from two solar evaporation ponds were transferred to a third and simply covered over with dirt, without so much as replacing the plastic liner.

Time and the intervening succession of monsoons have ensured that while India’s bureaucrats slept and corporate officials hedged their liabilities, these highly toxic and carcinogenic chemicals leached slowly into the groundwater aquifer beneath the plant site, poisoning the drinking water supply of at least 16 communities and an estimated 20,000 residents near the factory. Health surveys conducted in 2002 showed that one particular chemical, a carcinogen found in the water supply at levels exceeding by 1,700 times the maximum limit permitted by the World Health Organisation, could be found in the breast milk of nursing mothers in these communities. Not content with having poisoned the very air they breathed, Union Carbide chose to poison the waters of Bhopal before abandoning its facilities.

Officials in the Ministry of Petroleum and Natural Gas have indicated their willingness to sign off on the tie-up, advancing the argument that the Meteor technology belongs to Union Carbide’s new owner, Dow Chemical, and that no investment, only licensing, is involved in the project. The argument either is simply disingenuous or is evidence of a conscious disregard of the facts. Dow Chemical’s own website (www.dow.com) describes the Meteor technology as a Union Carbide product: "The thrust of Union Carbide’s catalyst programme, which resulted in the development of METEOR EO 180 catalyst, was to deliver super-high efficiency at high work rates." Dow Chemical’s 2001 Annual Report lists Meteor as one of the "trademarks or service marks of Union Carbide Corporation or its subsidiaries". When confronted with these undeniable facts, Ministry officials responded by pointing out that denying IOC this opportunity means depriving it of "world class" or state-of-the art technology.

The government’s memory, it seems, is rather short. No one seems to remember that Union Carbide, too, was supposed to be a licensor of "state-of-the-art" technology to its Indian subsidiary. In the lawsuits that ensued in the aftermath of the disaster, India accused Union Carbide of a "breach of warranty" with regard to its technology: "Defendant Union Carbide expressly and impliedly warranted that the design, construction, operation and maintenance of its Bhopal plant were undertaken with the best available information and skill to ensure safety. Defendant Union Carbide falsely represented to plaintiff that its Bhopal plant was designed with the best available information and skill and that the operation of its Bhopal plant would be maintained with current and up-to-date knowledge. Defendant Union Carbide is liable for any and all damages. due to its breach of warranties..." (Union of India vs Union Carbide Corporation in the Bhopal District Court, September 5, 1986, paras 30, 31, 32.)

In the litigation in which this writer represented victims of environmental pollution in Bhopal against Union Carbide, documents have been obtained that show, once and for all, the truth about the supposedly "state-of-the-art" technology that Union Carbide transferred to Bhopal. A 1973 Capital Budget Memo from Union Carbide’s Board of Directors in Danbury, Connecticut, sums up what the company knew about the "technology risks" of what it was transferring: "The comparative risk of poor performance and of consequent need for further investment to correct it is considerably higher in the UCIL operation than it would be had proven technology been followed throughout". (Emphasis added, throughout). CO and 1-Napthol processes have not been tried commercially and even the MIC-to-Sevin process, as developed by UCC, has had only a limited trial run. In short, it can be expected that there will be interruptions in operations and delays in reaching capacity or product quality that might have been avoided by adoption of proven technology.

In the litigation, Union Carbide has, time and again, thrown down the gauntlet to Indian authorities to compel them to return to India to face those charges. American courts have, in effect, invited India to assert its jurisdiction over this wanted criminal instead of simply sitting on its hands. In its August 2000 decision in the litigation, the U.S. Court of Appeals said: "Of course, the courts of India and the Indian government may have a legitimate interest in preventing or responding to the flight of the defendants and others from India and the jurisdiction of its courts. But. the defendants at most flouted the authority of the courts of India... It is the courts of India (augmented perhaps by the powers of the Indian government under, inter alia, treaties with the United States). that would have the authority in this case to defend their own dignity by sanctioning the defendants’ alleged acts of defiance, which occurred solely within their domain."

Such judicial confidence in the powers and authority of the Indian government to defend its own dignity has thus far proven ill-founded. To much of the world’s continuing dismay, India still refuses to punish Union Carbide’s acts of defiance.n?

H. Rajan Sharma is a New York-based attorney, author and expert on international law. He represents the victims in the federal class action litigation against Union Carbide relating to groundwater pollution in Bhopal.

See online : Frontline

P.S.

Volume 22 - Issue 10, May 07 - 20, 2005

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