Issue Date: August 6, 2007
Getting Past Bhopal
DOW CHEMICAL would like to do more business in India, but today it finds the risks too high. Since last October, and perhaps earlier than that, the firm has been lobbying the Indian government to clarify that the company had nothing to do with the tragedy that occurred in Bhopal in 1984 when gas leaking from a Union Carbide plant killed thousands of people. Dow bought Union Carbide in 2001.
Dow's lobbying efforts are described in documents that the International Campaign for Justice in Bhopal obtained this summer through India's information access laws. The documents' 50 pages also provide a status report on the Indian government's convoluted effort to clean up the former Union Carbide site. The documents are available on ICJB's website, www.bhopal.net.
ICJB is a coalition of Indian and foreign groups that strive to secure additional compensation and better health care for victims of the 1984 tragedy. ICJB also seeks "exemplary punishment" for Dow and the former Union Carbide executives who managed the Bhopal site in 1984. The coalition insists that Dow must pay for a cleanup. A 1989 settlement under which Union Carbide paid $470 million to India was inadequate, it contends, and did not cover the issue of site cleanup.
Among the documents released is a letter sent last October by Andrew N. Liveris, Dow's chief executive officer, to Ronan Sen, India's ambassador to the U.S., in which the CEO refers to the "Bhopal legacy issue." Liveris wrote that when he met Sen at the U.S.-India CEO forum in New York City earlier that month, he was assured that Dow was not considered responsible for the tragedy.
But the Indian government is in fact suing Dow, Liveris pointed out in his letter. The Ministry of Chemicals & Fertilizers initiated a court action in May 2005 demanding that Dow deposit $22 million to help pay for the cost of cleaning up the old Union Carbide site. In his letter, Liveris hints at future Dow investments in India and tells the ambassador that the suit has to be dropped to tangibly show that "the government of India means what it says about Dow's lack of responsibility in the matter."
The documents obtained by ICJB describe the complicated road map the government is following to clean up Bhopal. Since March 2005, several research institutes and government agencies have been working together to draw up a comprehensive plan to rehabilitate the site, which has been managed by the state of Madhya Pradesh since 1998.
In spite of the clarifications the documents provide, a timetable for just when a comprehensive remediation likely will begin remains unspecified. The documents say, for example, that proposals for soil and groundwater remediation "are being prepared" by India's National Environmental Engineering Research Institute and National Geophysical Research Institute, but they do not reveal this work's current status. Both NGRI and the Madhya Pradesh Pollution Board declined to comment to C&EN on this matter.
The documents make no mention of Cherokee Investment Partners, a North Carolina-based site remediation company that offered to lead efforts to remediate the old Union Carbide site on a charitable basis (C&EN, Feb. 5, page 18).
According to the documents, however, Ratan Tata, chairman of India's Tata Group, offered in early October to set up a remediation fund to spearhead a Bhopal cleanup. In a letter addressed to the deputy chairman of the National Planning Commission, he notes that the contaminated site is one of several impediments to the growth of business ties between the U.S. and India.
INDIAN OFFICIALS initially took Ratan Tata's offer seriously. A memo written by Shaleen Kabra, an official in the prime minister's office, notes that such a fund would eliminate Dow's need to pay a deposit on any cleanup efforts. Dow, the memo adds, is mulling "substantial investments" in India. But Satinath Sarangi, a key ICJB coordinator, claims that the government has recently cooled to the offer.
Neither Tata nor Dow would provide comments for this article, even regarding the question of what projects Dow is looking at in India. But Gujarat Alkalies & Chemicals informed the Bombay Stock Exchange in early July that it had signed a memorandum of understanding with Dow Europe to collaborate in the business of "chlorinated organics." Dow currently employs only about 300 people in India.
Unless the Bhopal issue is resolved, Dow will find it difficult to do more business in India. Pressure from activists forced the cancellation of a technology licensing deal between Dow and Indian Oil Corp. in 2005. And an ICJB member filed a lawsuit in Bhopal last year to prevent Dow from licensing Unipol technology, catalysts, and solvent recovery units to Reliance Petroleum.
Worth tens of millions of dollars, such licensing deals are a relatively small matter for Dow. A bigger loss for the firm would be a clear statement by the Indian government that Dow has a responsibility in the cleanup of Bhopal, which could open the door to private lawsuits from city residents claiming to have suffered from the contamination of the site. Such a development could completely spoil Dow's chances in the growing Indian market.
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