Chidambaram, Kamal Nath, Tata & Ahluwalia Support Dow

The 55 page PMO documents gathered using Right to Information Act (RTI) shows manifest collusion between ministers, officials and Dow Chemicals to protect it from the liabilities of Industrial catastrophe of Bhopal. The documents reveal how some of the ministers who have been made part of Group of Ministers (GoM) by the Prime Minister have been acting to safeguard the interest of the US corporation in question, which is liable for Bhopal disaster.

The GoM that has been constituted does not inspire confidence. Notably, the GoM, headed by Union Home Minister P Chidambaram, was constituted on May 26, 2010 by the PM's Office. It is expected that notification of the same from the Cabinet Secretariat will be issued shortly. The documents gathered using RTI reveal how Chidambaram and Kamal Nath have already expressed their support for Dow Chemical Company's proposal to save it from Union Carbide Corporation's liability which it inherited in 2001 after merger.

In a letter dated November 10, 2006, Chidambaram wrote to the Prime Minister about his visit to United Sates to review issues with the Indo-US CEO Forum in New York wherein he submitted a tour report mentioning his comments on Ahluwalia’s note. Referring to the matter of Dow Chemicals, Ratan Tata’s offer for remediation, he stated has stated, “I think we should accept this offer” in his comments dated 5th December, 2006. In December 2006, Dr S Jaishankar, Joint Secretary, Ministry of External Affairs in note titled “Issues Emerging from Indo-US CEO’s meeting” underlies how Dow has “sought a statement from GOI (Government of India) in the Court clarifying that GOI does not regard Dow as legally responsible for liabilities UCC” and wants to avoid “cloud of legal liability”.

In February 2007, Kamal Nath even wrote a letter to Prime Minister Manmohan Singh about the matter. In the letter, despite acknowledging the fact that the matter is sub judice he said “that a group under the chairmanship of the Cabinet Secretary be formed to look” in the matter of the liability of the Dow Chemicals “in holistic manner in a similar manner as was done in respect to the Enron Corporation with respect to Dabhol Corporation”. The immorality of his suggestion lies in the fact that ignores the Enron scandal that led to the bankruptcy of the Enron Corporation, a US energy company.

Incidentally, Ratan Tata in his role as the Chairman of the three-member Investment Commission, set up in the Ministry of Finance in December 2004 by the Government of India wrote to P Chidamabram, the then Finance Minister suggesting setting up a Fund for remediation on the site of Bhopal disaster that “would cost approximately Rs 100 crores.”

Donning another hat Tata wrote again as the Chairman, Tata Sons Limited to Montek Singh Ahluwalia, Deputy Chairman, Planning Commission, Government of India on October 9, 2006 with regard to resolve “various legacy issues” of “Dow Chemicals” pursuant to the recommendations of the Indo-US CEO Forum pointing out how the Investment Commission has not had “much success” in this regard. He referred to the interest of Andrew Liveris, CEO of Dow Chemicals with regard to approaches/solutions to the issue.” Chairman, Tata Sons Limited, Tata wrote again to Montek Singh on November 26, 2006 referring to letter of Andrew Liveris that was sent to Ronen Sen, India’s Ambassador to US wherein a request was made saying that “it is critical for them to have the Ministry of Chemicals and Fertilizers withdraw their application for a financial deposit by Dow against the remediation cost, as that application implies that the Government of India views Dow as ‘liable’ in the Bhopal Gas disaster case.”

Notably, Liveris had complained to Ronen Sen about how “GOI (Government of India) has taken position adverse to Dow“, in the Madhya Pradesh High Court. The case is still pending. Chairman, Tata Sons Limited, Tata wrote again this to time to the Prime Minister Manmohan Singh on 5th January 2007 wherein he put on record the meeting of the members of Investment Commission with the PM to discuss “the old Union Carbide tragedy”. The PMO’s letter from the B V R Subramanyam, Private Secretary of the Prime Minister dated January 12, 2007 assured Tata that “the matter is being examined” and “the Prime Minister has seen” his letter and “ has taken note of its contents”.

The real issue arising out of Bhopal verdict that has necessitated the setting up GoM is its fallout on the proposed Liability for Nuclear Damage Bill that is pending in the parliament. It has emerged any future liability regime must include criminal liability and must not cap the amount of civil liability because the damage from a nuclear or chemical disaster depends on the direction and nature of the wind at the time of the accident.

Bhopal verdict reveals that no lessons have been learnt from Chernobyl nuclear disaster and Three Mile Island Nuclear Accident. It is sad that even Parliament's standing committee on Environment, Forests, Science and Technology is frozen in its passivity be it with regard to Bhopal or nuclear liability. The Committee is under the chairmanship of T Subbiram Reddy who is on record in parliament to have opposed any liability arising out of asbestos exposures. Incidentally, the Dow Chemicals Company has set aside $2.2 billion to address future asbestos-related liabilities arising out of the Union Carbide acquisition. How is that Dow Chemicals can take the asbestos liability of Union Carbide and not the liability for the industrial catastrophe in Bhopal?.

The Supreme Court’s verdict in the WTO Case and the present apex court engineered order of the Court of Chief Judicial Magistrate of Bhopal demonstrates beyond doubt how Indian parliament, the premier law making law making institution appears to have become almost defunct. It must re-invent its role and assert its authority.

The WTO case because soon after the conclusion of the Uruguay Round some state governments had filed a case in India’s Supreme Court on the grounds that the government of India had no authority to accept obligations arising out of the Agreement on Agriculture (AoA) because of agriculture’s status as a state subject. India's accession to WTO was challenged because it WTO is a supranational legal system for corporations, outside our constitution and courts. Prof. Upendra Baxi had commented that had India's Supreme Court not overruled the submission with regard to unconstitutionality of India's accession to WTO, Bhopal judgement would have been different. Apex court's decision in the WTO accession case ignored legal sovereignty of India and paved the way for a distorted verdict in Bhopal disaster case.

The government of West Bengal reiterated these concerns in May 2001, saying that ‘agriculture is a state subject, therefore all agreements, legislations etc., are within the exclusive domain of the state governments’, and that it was unacceptable that ‘the government of India had signed the AOA…. without first arriving at a consensus among the state governments’. Notably, the state governments were and are not regarded as significant stakeholders during the Uruguay Round and WTO negotiations although some of the Indian states larger than many WTO members, but also because agriculture is a state subject.

While India's apex court disregarded the argument of states' consent the fact is that State consent is an important source of legitimacy for the WTO. State consent is seen as an expression of a state's own free will and, therefore, when a state consents to a WTO agreement, it is assumed that WTO membership is in its best interests. State consent is also an expression of a state's Legal Sovereignty. What is expected of WTO to be legitimate is to ensure that its member states consent to be its members but when states of India do not give consent to Indian state in matters of international and multinational negotiations, the was/is disregarded. The WTO accession case set a bad precedent and Bhopal verdict is a fallout of the same.