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September 26, 2007
Dow Chemicals' Indian subsidiary under scanner
Arnab Pratim Dutta, Down To Earth, September 26, 2007
SURYA SEN / CSE
Paying for poison: CBI on the lookout for other errant officials
De-nocil, an India subsidiary of Dow Chemicals, is being investigated by the Central Bureau of Investigation (cbi) for its role in bribing Indian officials at the Union ministry of agriculture to get three pesticides registered.
The cbi has zeroed down on three meetings of the ministry’s Central Insecticides Board and Registration Committee held in 1997, 1998 and 2000 where the then director of the licensing committee R L Rajak may have exerted undue influence to get the pesticides—Pride (ni-25), Nurelle-D, and Dursban—registered.
The pesticides are marketed by De-Nocil (renamed to Dow AgroScience Private Limited).
According to cbi sources, meetings of number 199 of April 20, 2000, 178 of April 23, 1998 and 169 of July 17, 1997 of the licensing committee decided to give clearances for registration. The source added that Pride (NI-25) was subsequently registered on May 5, 2000, Dursban and Nurelle-D, got their registration on April 24, 1998 and July 29, 1997. The cbi, which filed an fir on August 16, 2007, named three other persons—L Ramakrishnan, P Natarajan and Banerjee—employed by De-Nocil as consultants. Reportedly, between 1997 and 2000, De-Nocil spent us $200,000 as bribes. Of that, us $32,000 was paid to Rajak by the consultants.
The cbi is also investigating a case of bribery against Agro Pack and Crop Health Products Limited, the two companies which were the product formulators for De-Nocil. De-Nocil earned around us $435,000 between 1996 and 2000, of which us $330,000 was sent back to its parent company Dow Chemials. According to cbi officials, Dow Chemicals used their consultants and their product formulators to pay-off Rajak for getting their products licensed. He said that apart from cash, the company also paid for Rajak’s travel and hotel bills, besides ‘gifting’ him expensive jewellery.
On August 21, the cbi conducted raids in six cities, which include De-Nocil’s headquarters in Mumbai, offices of Crop Health Products and Agro Pack in Ghaziabad and Bharuch, along with houses of former employees and consultants in Chennai, Pune and Faridabad. While the cbi has only booked one government official, it is also looking out for other officials in the Registration Committee and the agriculture ministry.
The investigations were prompted by a letter from the agriculture ministry asking cbi to take up the matter.
Posted by tim at 03:27 PM | Comments (0)
September 10, 2007
Dow swings the carrot before the ass
The Economic Times, 10 Sep, 2007
Just in case ministers had briefly forgotten what rewards await them if they will only allow themselves to yield to temptation, tantalising, coquettish Dow is flaunting its charms Delhi-wards once more. In what amounts to a 'dance of the corporate veils', all the PMO's office need do to gain the union it so desires - a $1 billion injection of Dow's assets - is affirm the legalistic lie of Dow's separateness from Union Carbide via the Law Ministry. The image that arises from this game of seduction is that of two libidinous lovers unable to end their mutual frustration thanks to an unseemly infection. It's an infection the survivors of Bhopal will not cease from aggravating. Ed.
Dow Chem sees 50% R&D done here
HYDERABAD: Plastic and chemicals major Dow Chemical International is looking to expand its R&D presence in India. This would help the company leverage on the high quality talent pool available here to create process excellence.
In the next five years, Dow expects 50% of its core R&D activities to be done out of India. The company is also evaluating setting up a manufacturing facility in the country.
If a decision is taken, Dow would join the league of companies planning to set up shop in petrochemical SEZ. “Dow has 150 manufacturing facilities in 37 countries and a separate team evaluating pros and cons of a manufacturing base in India,” said Dow’s director Peter G Halloran.
“We have set up an R&D centre in Pune focusing on chemistry. The centre employs over 100 people. We are looking at scaling up the headcount to 500 in about three years. Besides, we have an engineering R&D centre in Chennai, which houses over 100 people.
The headcount there will be ramped up to 1,000 in over two years,” he said on the sidelines of the global supply chain summit orgainsed by the Indian School of Business. Dow Chem has partnered TCS for a shared services division in Mumbai, which is a BPO unit doing high-end back office work.
“The headcount at this centre will also be enhanced from 250 to 1,000 in about three years,” he said.In an effort to mitigate the risk of rising oil prices on its supply chain, the company is also reducing its dependency on oil. “We are procuring natural gas from the Middle East and this will, to some extent, off-set the rising cost of oil on our entire supply chain. We have formed a JV with a Libyan company to procure gas and is looking at another partnership in China,” he said.
Posted by tim at 02:36 PM | Comments (0)
September 06, 2007
Ministries differ over Dow liability in Bhopal clean-up
Nitin Sethi & Akshaya Mukul, Times of India, 6 Sep 2007
NEW DELHI: As government moves fast to help Dow Chemicals invest in India, a sharp difference of opinion has risen between the ministries of law and chemicals on whether the chemicals giant could be held legally liable for the 1984 Bhopal gas tragedy clean-up.
The Chemicals Ministry had earlier indirectly held Dow responsible for the tragedy by demanding it to pay an advance for clean-up of the contaminated site while courts adjudicate on the matter.
But the Law Ministry is of the opinion that it would depend upon the deal between Dow Chemicals and Union Carbide at the time the latter sold itself to Dow to decide whether Dow should hold legal liability for the Bhopal disaster.
The Chemicals Ministry, in tandem with the Law Ministry, was asked recently by the government to forward a fresh note on Dow's liability despite its earlier stand that the chemical giant shell out Rs 100 crore as advance for the liability of cleaning up while the Jabalpur Bench of the Madhya Pradesh High Court adjudicated on the matter.
Sources told TOI that the Chemicals Ministry had stuck to its guns and defended its position of demanding a pay up from Dow.
However, the Law Ministry contends it would be crucial to figure out whether Union Carbide had passed on its liabilities to Dow when it was bought over in 2001 before implicating Dow Chemicals into the case.
But not wanting to disturb the ongoing court case, the Ministry believes the decision could finally lie with the judiciary.
Senior government officials told TOI that the law ministry's advice could be interpreted to mean that instead of demanding the advance, the government should look at the fine print of the deal between the two companies.
In the case of the deal between the two not transferring any legal liabilities, the chemicals ministry may have to withdraw the demand and therefore weaken the case against Dow in the courts as well.
The notes from the two ministries come against the backdrop of hectic lobbying by several UPA ministries as well as the Planning Commission for clearing the way for Dow's investments in India. Dow has threatened that it would not be able to make any new investments in India as long as the legal liability existed in the form of a demand from the Chemicals and Fertilisers Ministry.
Business leader Ratan Tata, head of the Indo-US Business Council, too had approached the government suggesting that the Indian industry led by him may be allowed to pay for the clean-up in order to take the legal liability off Dow.
nitin.sethi@timesgroup.com
akshaya.mukul@timesgroup.com
Posted by tim at 10:26 AM | Comments (0)
September 05, 2007
Dow offers to clean up Bhopal gas tragedy mess
The following article contains no quotes from either government or Dow sources and appears to be a plant aimed at softening public opinion to the idea of Dow paying a sum of money and then walking away from its legal obligations under the polluter pays principle. Both in principle and in defence of the need for full reparations for the thousands who suffer damaged health from Dow's ongoing poisoning, survivors will oppose such a move with all their strength. Ed.
Gireesh Chandra Prasad, TNN, 5 Sep, 2007, Economic Times
NEW DELHI: Dow Chemicals, which has drawn up major investment plans for India and is reported to be in talks with Reliance Industries (RIL) for a manufacturing joint venture, has volunteered to pay for cleaning up the Bhopal gas disaster site as long as it is not slapped with the legal liabilities of Union Carbide Corporation (UCC).
The gas tragedy at UCC’s Bhopal plant took place in 1984. Dow acquired UCC in 2001.
Official sources told ET that Dow has indicated its willingness to pay, but it should not be seen as an obligation. Dow acquired UCC 12 years after it paid $470 million to the government as the final settlement of all claims as per the Supreme Court’s directions.
Consequent charges or cases cannot, therefore, be Dow’s liability, the company feels. The global petrochemical major sees the cleaning-up as an act of corporate social responsibility.
The ball is now in the law ministry’s court. Its views would be crucial in resolving Dow Chemicals’ demand to be absolved of the legal liability. The company’s offer to voluntarily clean up the mess has come at an appropriate time.
It may be recalled that Investment Commission chairman Ratan Tata had earlier written to the Planning Commission that Dow should be absolved of these liabilities and steps could be taken by others to clean the mess.
The law ministry is now expected to take a call if Dow would come under the definition of ‘polluter’ by virtue of acquiring UCC. The chemicals ministry had earlier told courts that the polluter should pay for remediation, redevelopment, of the disaster site. “We did not mention who the polluter was. By implication, Dow became liable,” said a government official.
The chemicals ministry is likely to place the law ministry’s views and facts before the Cabinet, without explicitly supporting Dow’s demands or turning it down, it is understood. The ministry would tell the Cabinet that while investments are needed, a decision should be taken keeping in mind the sentiments of the affected families.
Dow apparently fears that an unresolved legal liability could come in the way of its executives’ visit to India for business purposes, said a chemical industry source. An assurance from the government that it is not legally liable would go a long way in the company’s plan to transfer operations from some other parts of the world to India, said the source.
However, some sources said that the chemicals ministry will have to withdraw earlier affidavits filed in courts saying that the polluter should pay if it were to allow Dow come in without any liabilities on this count. It remains to be seen if the judiciary will agree to what the government decides politically, he said.
The government had earlier demanded that the company pay Rs 100 crore initially to clean up the site and later pay whatever additional expense it actually incurs.
“Overground contamination has been cleaned up. Now, the more complex underground clean-up remains. It needs technical expertise. Mumbai-based University Institute of Chemical Technology is studying how to go about it,” said a source.
Comment:India is at a cross-roads between choosing her people against corrupt corporations, in the name of FDI. DOW chemicals is a classic case of socially irresponsible company who ignored all the legal battles and protests of Bhopal survivors, with such discontent, till now but when it is time to invest in India, it talks of its "Social Responsibility". However this is their "Moral and legal Responsibility" as they are still using UC patents for profits.DOW should be made to not just pay for clean up but also for the health problems caused.
Name:Somu Kumar
Location:Washington DC
5 Sep, 2007 1721hrs IST
Posted by tim at 11:34 PM | Comments (0)