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.

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