Beyond Bhopal: incentive for unsafe industries

Luck plays in strange ways. I was reaching for my scooter when the telephone rang in my office-cum-residence in Bhopal.

I opened the gate, unlocked the door downstairs, ran up the steps to the first floor and opened the door to my apartment. Normally the caller would have given up, but the phone kept ringing (this was 1984 and mobile phones had not been invented). I picked up the receiver and heard the voice of a grown-up man crying. I was getting the tip-off of my career.

On the night the gas disaster happened, I’d been reporting in Indore. I heard garbled news about a few people dying in an explosion. I took a cab to Bhopal 200 km away. I was startled to see overloaded buses and trucks streaming out of the city. Ours seemed like the only vehicle heading in. Outside the city the police tried to stop us but I talked my way past.

I reached Hamidia Hospital, Bhopal’s main health centre. Bodies lay in row upon ordered row, wrapped in white sheets. I was only 28 and stunned. India Today was a fortnightly and I had a week to put the story together. While the dailies focused on the deaths, I knew I should concentrate on finding out what had happened and why. Where should I begin? Over the next few days, I got in touch with all possible contacts I had made over three years as a reporter in Bhopal. But thousands had fled. And that is when I got the call …

The caller said he worked for Carbide and knew what had taken place. He had chosen to speak to me because he was familiar with my reporting and believed he could trust me not to be pressured by the government (which people instinctively believed would have something to hide).

He came over with three of his friends a while later. He was emotionally charged and spewed out an incomprehensible story of the tragedy. I didn’t interrupt him. After he had finished I told him that we would have to go over everything slowly. He was hungry and needed to go out for a bite. I was terrified of letting him go. What if he didn’t come back? He hadn’t even told me his correct name. But they did return and my informant took me through the whole trail of slipshod corporate safety measures that had led to the disaster.

To confirm this version I found a chemical engineer with Carbide. He was petrified and reluctant to get involved. I told him to at least confirm whether the version I had made any sense to him. He gradually thawed and helped me with small technical changes that made the version I had more credible.

How could we explain, step by step, how the safeguards had failed? I bought innumerable pictures from the official photographer of Union Carbide. Then I made a layout of the plant on paper. Next, on the back of each picture I painstakingly noted the angle from which it had been taken. Using this material our illustrator put together how the plant looked from the inside. I subsequently located a former safety officer of Carbide who had shifted to Delhi. I flew down there and he became my third source to check the original story. He was a senior executive who had spent many years with the company. He was astounded: the illustration we had put together based on the photographs and layout was entirely accurate. He found it hard to believe we had put it together without access to the premises.

The story was complex. I wrote on different aspects, while my editor, Suman Dubey, an effortless writer, put it together into a single whole. When that issue of India Today appeared, the dailies hadn’t caught up with us. The international press used the issue to get a sense of the disaster.

Some months later I shifted out of Bhopal. One thing I will never forget is the sight of shrouded bodies of children.

More than a quarter century after the industrial disaster that devastated Bhopal, a series of significant developments occurred, all in June 2010. First, there was a court verdict on the gas tragedy case convicting then chairperson Keshub Mahindra and six others of Union Carbide India Limited (UCIL), the Indian subsidiary of America’s Union Carbide Corporation (UCC). Two weeks later the group of ministers (GoM) on the Bhopal gas tragedy submitted its report to the prime minister and recommended relief measures that came 25 years too late. The verdict convicted the accused after the 1996 Supreme Court order diluted charges from culpable homicide to negligence; this brought down the sentence from 10 years of imprisonment to two.

The GoM, the ministerial panel headed by home minister P Chidambaram, by way of addressing public anger, recommended that the next of kin of those who died in the accident be given a compensation of Rs 10 lakh; it also suggested the government seriously reconsider pursuing the extradition of Warren Anderson, who was the chief of UCC at the time of the accident in Bhopal. He lives in the US.

Washington turned down India’s extradition request in 2004, citing insufficient evidence of intent. This time, the GoM clarified, “According to CBI, there were defects in the plant and proof of continuous neglect that is tantamount to intent; therefore, extradition will be pursued.” Activists have asked why the government is not seeking extradition of other absconders, such as representatives of UCC and Union Carbide Eastern Hong Kong (UCE).

UCC held 51 per cent stakes in the company and both UCC and UCE played an active role in the Bhopal plant’s management. From the beginning, people of Bhopal have been talking of the negligence by the entire management; and Anderson is symbolic of that negligence, said Upendra Baxi, Emiritus Professor at the School of Law at UK’s Warwick University. “What is novel about the June 7 verdict is that instead of naming only Anderson, UCC and UCE have been named as separate parties. The people of Bhopal have from the beginning demanded justice against Carbide as a whole; Anderson is only a representa- tive,” he said. Baxi had argued in 1991 for reopening the criminal liability case.

The GoM has placed three options for reviewing the criminal case: enhancing punishment under existing charges, filing a curative petition against the 1996 order that diluted the charges or filing a case in the Madhya Pradesh High Court with the original charge of culpable homicide under Section 304-II of the Indian Penal Code. “I don’t know whether the curative petition will help because the seven officials will file an appeal against the present verdict, and the judicial process will go on a long time (curative petition can be filed only after the appeal is settled),” Baxi said. “Enhancement of punishment under the same charges can be a better idea,” he added.

Opportunity dismissed in April

What could have cut short a long-drawn judicial process, believe activists, is a petition for review of charges that was filed in April this year by organizations intervening in the case—Bhopal Gas Peedit Sangharsh Sahayog Samiti (BGPSSS) and Bhopal Gas Peedit Mahila Udyog Sangathan (BGPMUS). The petition filed under Section 216 of the Criminal Procedure Code (CrPC) asked for enhancement of charges based on the submission made by 178 prosecution witnesses. Article 216 of the CrPC empowers any court to alter or add to any charge at any time before judgement is pronounced. “The latest submissions were sufficient to enhance the charges. But the chief judicial magistrate (CJM), Mohan Tiwari, dismissed the petition,” said N D Jayprakash, convenor of BGPSSS.

The June 7 verdict stated, “The conduct of the directors and engineers of the factory...proved beyond reasonable doubt they neglected the deteriorations reported to them by the US team and by the local employees.” It noted that methyl isocyanate (MIC), the lethal gas that leaked from the factory on the night of December 2-3 in 1984 and instantly killed 10,000 people, was stored in large quantities (42 tonnes) even though only three-four tonnes were required. “Some important systems were shut down for months together...while the plant was shut down for maintenance. This was an omission on the part of the management; the US team was also silent about some of the above facts,” the verdict said.

“This statement itself could have supported a larger charge,” said Supreme Court advocate Rajeev Dhavan. Even the verdict mentions, “Knowing all the things, they omitted to do what they were entrusted to do.” Dhavan said the CJM could have told the prosecution to approach the apex court at that stage; “it would be a big call for a CJM to go against the apex court and alter charges.”

The plant in Bhopal was the only one in the world which had MIC storage as part of its design. To cut costs the number of staff was reduced sometime before the accident, the nitrogen pressure in the MIC tanks was reduced (the pressure kept the gas under control), and the alarm system had been shut down. There were enough warnings of the impending disaster—newspaper articles, a legal notice to UCIL, a UCC audit report that talked of 30 major hazards, of which 11 were in the MIC and phosgene units of the Bhopal plant.

Most of these facts were placed before the Supreme Court in 1996, when chief justice A M Ahmadi and S B Majmudar diluted the charges citing lack of prima facie evidence that the accused operated the Bhopal plant on the night of the accident “with the knowledge that such running of the plant was likely to cause death”.

“There was enough evidence in the documents seized from the company. Even now Ahmadi has not been able to give a good reason for diluting the charges,” said K Madhavan, former joint director of CBI who was a DIG in charge of the Bhopal case till 1988. The Bhopal case received the biggest blow in 1989 when the apex court agreed to a one-time settlement of US $470 million and quashed the criminal charges.

“Throughout, there was the absence of any application of judicial mind to understand the magnitude of the disaster,” wrote Praful Bidwai, journalist who followed Bhopal closely. In India, we still do not have a set of judgements for defining negligence and liability from which lower courts could take precedence. There are, though, pieces of legislation that were enacted in the aftermath of Bhopal.

Slide Show: Toxic Legacy

Has Bhopal taught the nation how to ensure industrial safety?

Following the Bhopal accident, several pieces of legislation came into force, the prime one being the Environment Protection Act (EPA), 1986. In 1987 a new chapter was added to the Factories Act, 1948, in the aftermath of Bhopal and the oleum gas leak in New Delhi in 1986. One person died and many others were affected when oleum gas leaked from the plant owned by Shriram Food and Fertilizers in Delhi.

“A significant change was the redefining of the word ‘occupier’. One of the directors of the company has to be the occupier now,” said Usha Ramanathan, law researcher who has studied the Bhopal case. The occupier implies a person designated as responsible for the affairs of the factory, including safety. ‘Hazard’ and ‘disaster’ were now extended to people living nearby and not just on the factory premises, Ramanathan explained. The amended Factories Act now states it is the occupier’s obligation to show, in the event of an accident, that due diligence had been exercised to enforce the safety obligations.

But the amendment absolved the manufacturer of responsibility for safety as long as the user of a hazardous technology gave an undertaking: “The article will be...without risks to the health of the workers when properly used.” This clause works in favour of companies like UCC. In the Bhopal case even though UCC held 51 per cent shares, it contended it is not liable because UCIL was in charge of operations.

“The amendments to the Act are flimsy as factory inspectors are corrupt and certify without knowing the technicalities,” said Bidwai. “The EPA, too, added a new list of hazardous chemicals but never really collected data on their use in India,” he added.

In 1991, the Public Liability Insurance Act (PLIA) came into force to provide interim compensation to the victims in the event of an industrial disaster without having to prove neglect or wrongful act of any person. PLIA requires industry owners to obtain insurance policies which shall not be less than the paid up capital of the unit and limited to Rs 50 crore. This was amended in 1992 because insurance companies were unwilling to insure hazardous companies for a sum without a cap on compensation per victim. “This, even though the PLIA prescribed limits on the amounts to be paid to each affected person where death, serious injury, loss of work, or damage to property occurs,” Vijay Nagaraj and Nithya Raman wrote in an article in the December 2004 issue of Seminar. The maximum compensation that a victim can claim under this Act is Rs 25,000.

An Environmental Relief Fund (ERF) had to be created to receive the premium a factory owner paid on his insurance policies under PLIA. “It was supposed to disburse compensation once the National Environment Tribunal Act came into the picture,” said Supreme Court advocate Sanjay Parekh. The Act was passed in 1995 to set up tribunals to deal with the determination and disbursement of compensation. “It never came into force and now the matter is proposed to go under the Green Tribunal Act,” said Parekh.

In 1989, Manufacture, Storage and Import of Hazardous Chemical Rules were notified, which stipulates the maximum storage limit of 11 chemicals.

The Bhopal disaster reached such mammoth proportions because the amount of MIC stored was much higher than actually required for the production of Sevin, UCIL’s final product. “Storage rules or even hazardous waste rules for that matter are not being followed at all,” Parekh said. State pollution control boards are supposed to check if there is enough facility for storage before giving clearance for a factory but that is all on paper. There are so many mini-Bhopals waiting to happen, he added. “For instance, we do not have a hazardous waste disposal facility in Delhi, so where has all the waste been going all these years?” Parekh asked.

The group of ministers (GoM) has not made it clear whether Dow Chemicals, the company that acquired UCC in 2001, is to be held liable for the threat to public safety as a result of the toxic waste the pesticide factory dumped on its premises.

It has only said the case against Dow Chemicals in the Madhya Pradesh High Court will continue.

The GoM decided on June 21 that India would take up the cleaning of the factory premises and continue to pursue Dow for the clean-up expenses. In 2005, the Union Ministry of Chemicals and Fertilizers moved the Madhya Pradesh High Court to direct Dow to deposit Rs 100 crore towards environmental remediation. The case for clean-up has been going on since 2004; Dow is one of the respondents.

Dow Chemicals has maintained it bought over UCC 10 years after all claims had been settled with the Indian government for US $470 million. Therefore, it does not have any of UCC’s liabilities (see ‘Subterranean Leak’, Down To Earth, December 1-15, 2009). “Dow’s defence can be struck down on the basis that its contractual agreement is contrary to the public doctrine of polluter pays; statutory liability is not a matter of contract,” said Dhavan.

The polluter-pays principle is law in India, and intent or knowledge of contamination is not a prerequisite for being held accountable. The Hazardous Waste (Management and Handling) Rule of 1989 stipulates that producers of the contaminated waste are responsible for decontamination.

Experts believe the Indian government should stress on the fact that UCC’s full settlement was for compensation to victims and not for environmental remediation. And that the cleaning up of the site has nothing to do with the accident, but the fact that it was dumped in and around the factory long before the gas leak occurred. “The 1989 settlement order never touched upon contamination,” Baxi commented. “This makes it all the more important for the Indian government to intervene on environmental contamination in the civil case pending in US district court in New York. The government of India has to file an affidavit and make a case on behalf of Bhopal victims,” he added.

Coming forward to clean up the toxic waste could be one of the victimappeasement tactics of the government without intending to hold anyone liable. But if it does have the intent, said G Mohan Gopal, director of the National Judicial Academy in Bhopal, the government should file a fresh petition under Article 226 based on the findings with the CJM’s court and start the case again. “Once the site is cleaned, there will be no case against Dow and no reason for it to pay,” said Balkrishna Namdeo, member of the Gas Peedit Nirashrit Pensionbhogi Sangharsh Morcha, a victims’ group in Bhopal.

Namdeo wants the government to fix environmental and criminal liability on Dow Chemicals as it is UCC’s successor. “The government should take stringent actions against Dow and set an example for multinationals that they cannot get away with murder,” he added.

This, Namdeo said, was even more relevant in the context of the Civil Nuclear Liability Bill that is being discussed. “A nuclear accident is going to have multiple impacts and if the government frees the suppliers of liabilities it will give them the licence to kill,” the activist said.

Civil nuclear liability bill

The recently introduced Civil Nuclear Liability Bill, under review by the Parliamentary Standing Committee on Science and Technology, Environment and Forests, seeks to limit the liabilities of companies establishing nuclear power plants in India.

The bill has been opposed from the beginning because it fixes a liability of about Rs 2,050 crore or US $450 million on the operator and absolves the suppliers of any responsibility towards safety. “The amount is even less than what the Bhopal victims got. It is peanuts,” said Anil Chaudhary of the non-profit Coalition for Nuclear Disarmament and Peace in Delhi. “Everyone involved in the process of producing nuclear energy should be held liable. Why should suppliers go scot-free?” he asked.

Of the Rs 2,050 crore, the proposed bill caps the operator’s liability at Rs 500 crore. The government will bear the balance (see ‘Radioactive Mirage’, Down To Earth, October 1-15, 2009).

The Nuclear Power Corporation of India Limited (NPCIL) under the Department of Atomic Energy is the operator for all nuclear power plants in the country. In case of an accident, the Government of India will have to cough up all of the Rs 2,050 crore—unless a private operator is allowed. But this can only be through an amendment to the Atomic Energy Act.

“It is difficult to say whether an amount is high or low, but it is worth asking why India has a low liability and why does it have a cap. Germany has unlimited nuclear liability,” said Ambuj Sagar, professor at IIT Delhi. The limited liability and the cap are attributed to the fact that India wants to be a part of the International Atomic Energy Agency’s (IAEA’s) Convention on Supplementary Compensation (CSC), which aims to establish a worldwide liability regime. As per the convention there is a cap of 300 million SDRs (special drawing rights, a quasi currency) on the liability amount. The 300 million SDRs are equivalent to Rs 2,050 crore. In case of a nuclear mishap CSC will enable India to receive compensation above the capped liability limit from other countries party to the convention.

But the twist is CSC is not operational. It will become operational only if a country with a major nuclear programme such as Japan accedes to the convention.

Could India then go the US way and create a liability pool? Analysts explained that would be possible only if there were a large number of private operators in the country.

Then, in the bill, there is the right to recourse against suppliers in case of wilful act or gross negligence under clause 17 (b). There is no such clause in the CSC. The Indian government considered removing this clause, but it decided to let it remain.

India has two options: to remove the 17(b) clause in its bill to become a part of CSC or to stay out of the convention like South Korea. The latter will ensure India can approach the court of the nuclear supplier country in case of a mishap, wrote Siddharth Varadarajan in a recent article in The Hindu. He is a senior journalist and one of the members called to depose before the standing committee meeting on nuclear liability.

Analysts, though, point towards an injustice in section 18 of the proposed bill. “This section states that claims for compensation for nuclear damages can be made only within 10 years. Nuclear accidents can affect health for generations, so it is unfair to limit the number of years to file for compensation,” said M R Madhavan of PRS Legislative Research, a think-tank in Delhi. The bill defines “nuclear damage” as loss to life and property as “notified by the Central government”, he said. “The Central government being the operator of the plant through NPCIL cannot notify the true extent of the loss incurred. This is conflict of interest,” he added.

Clause 46, though, preserves the victims’ right to file claims. This raises the possibility of criminal liability in case of negligence on the part of the operator. “Given the unhappiness over the Bhopal settlement, the standing committee must ensure the nuclear bill does not dilute the victims’ right to file claims against any party in the event of an accident,” Varadarajan wrote. Nuclear energy is almost half a decade old, and two major accidents later it is still unclear what should be the liability amount and who should bear it.

New technologies and dangers

What happens to liability in case of new technologies? Take for example, genetically modified organisms (GMOs), purportedly to increase food pro - duction, and carbon capture and storage (CCS) that seeks to bury the emitted carbon dioxide somewhere deep into the earth. CCS is considered one of the methods to mitigate global warming triggered by emissions from fossil fuels. GMOs are a reality in India, with Bt Brinjal (despite a mora torium) and many others waiting for the nod.

At present, the National Green Tribunal Act 2010 does provide for compensation, relief and restitution of any damage to the environment, including flora and fauna. But its efficacy remains to be tested.

Internationally, especially in the EU, the GM liability clauses are well defined. Austria has the strictest regime, with a pre-sowing authorization system, which guarantees its moratorium. The Cartagena Protocol on Biosafety held its meeting in Kuala Lumpur on June 15- 19, 2010. The meeting stressed providing financial security so that damages do not remain unredressed under the liability regime.

As far as CCS is concerned, no country is really prepared for this fairly new technology, said Sagar. “There is no clarity on the magnitude of potential disasters they could cause,” he added.

There is 1.1 million tonnes of highly contaminated soil at the plant site, according to an estimate by the National Environment Engineering and Research Institute (NEERI) in Nagpur.

It needs to be treated and safely disposed of. The report said up to two metres of soil will need to be dug up, except at one place where the underground dump was as deep as eight metres.

The main contaminants, according to NEERI, are chlorinated benzene compounds and mercury, both volatile. The impervious soil near the plant site prevented toxic chemicals from leaching too deep. Besides the ground, there are 70 litres of mercury spillage and 1,500 tonnes of corroded plant structures that have to be dismantled and detoxified. Five borewells downstream of the plant, within a range of 3.5 km, have shown the presence of pesticides, the NEERI report said. It has advised these wells be sealed urgently. The study conducted by the Centre for Science and Environment in December 2009 found groundwater contamination as far as three km.

NEERI conducted a similar study in 1996 at the behest of Eveready India Ltd, the Indian arm of UCIL, because the company wanted to dismantle and sell the plant. The study found pesticides, mercury and other toxic elements. UCIL did not make this report public; it returned the land to the Madhya Pradesh government without remediation, violating the lease condition that the site be handed back in “habitable and usable condition”.

The GoM report has recommended Rs 300 crore for decontamination and remediation of the plant site. The state government will administer the cleanup with technical help from the Centre. Based on studies by NEERI and Hyderabad- based Indian Institute of Chemical Technology (IICT), the GoM recommended a joint task force of Central and state governments to be headed by the Union environment ministry. Foreign companies could then be called to bid for the clean-up.

Sevin tar and other pesticide residue stored in the godowns would be sent to the Pithampur industrial area in Madhya Pradesh’s Dhar district for incineration. But residents are against letting this waste into their neighbourhoods (see ‘Bhopal’s toxic links with Indore’, Down To Earth, April 15-30, 2009). NEERI has suggested that the best solution for the contaminated soil is to store it in secured landfills, which should be constructed at the plant site. The only option for cleaning the groundwater is to pump it out, treat it with activated carbon and pump it back into the ground, NEERI said.

NEERI and IICT have given an estimate of Rs 100 crore for soil clean-up and 110 crore for plant dismantling. An industry insider, who works on waste treatment and remediation, said the cost can go up to Rs 1,500 per tonne of soil which would mean Rs 165 crore only for soil remediation. For pumping water, treating it with carbon and then disposing of the carbon can cost Rs 200- 300 per kilolitre, he said. “There are many companies in India that can do the clean-up much better. Even waste treatment facilities abroad are managed by Indian engineers,” he said.

“More than the present level of contamination, I am worried how the government will carry out the remediation,” said Salim Romani, former Central Ground Water Board chairperson who now lives in Bhopal. “What if the government does a shoddy job?” he asked, voicing the fear of most Bhopal’s residents.