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    June 16, 2010

    Remember Bhopal


    HONG KONG — President Obama would do well to take time out from bashing BP and reflect on the American corporate and official response to a much greater human and environmental disaster: Bhopal, India, 1984.

    Clouds of lethal gas emitted by a factory owned by U.S.-based Union Carbide into the heart of that central Indian city immediately killed some 2,250 people, and affected as many as 500,000 more. Of that number, it is estimated that between 15,000 and 30,000 people subsequently died as a consequence of the accident and tens of thousands of others remain sick.

    To this day, Bhopal bears the human and physical scars of the disaster, which was never properly cleaned up — either before or after Union Carbide sold its Indian business to a local group in 1992. Union Carbide has yet to admit responsibility for a catastrophe, which it blames on “sabotage.”

    Much of the subsequent suffering and failure to prosecute those responsible lies with Indian governments, local and national, which have seemed more concerned with bickering among themselves than helping the victims. Another failure has been the absurdly slow, and sometimes partial, operation of India’s judicial system. Only this month, 26 years after the event, did the courts finally hand down guilty verdicts on seven Indian management and technical staff members, all now in their 70s. They received two-year prison sentences and small fines and are free on bail, pending appeal.

    But let us not forget the role of the U.S. parent company, whose executives made every effort to distance themselves from responsibility for the operation of their Indian subsidiary. Union Carbide paid what even then was, given the magnitude of the tragedy, a modest amount — $470 million in a 1989 compensation deal with the Indian government, a fraction of what had been sought. It did agree, however, to build a hospital with profits raised from the sale of its Indian operations in 1992.

    The company’s total payouts were roughly the equivalent of $1 billion in today’s dollars — what BP has already spent. Union Carbide, which never stopped paying dividends in order to make more money available to help the Bhopal victims, was taken over by Dow Chemical in 2001, and was able to further distance itself from the tragedy.

    The combined effect of U.S. corporate and Indian official neglect ensured that efforts to compensate victims’ families, provide proper hospital care and support for those continuing to suffer, or clean up the environmental mess were pitiful. American courts also rejected victims’ efforts to pursue their claims in the United States.

    The Union Carbide chairman at the time, Warren Anderson, visited India after the accident, was charged and then released on bail. Subsequently, a culpable homicide charge was brought against him but he never returned to face it. Arrest warrants were issued, but neither the Indian nor the U.S. governments made any effort to extradite him and he escaped having to stand trial.

    It is easy to make scapegoats of chief executives, who cannot easily be held responsible for corner-cutting and negligence by employees thousands of miles away. Compensating victims and improving procedures is more fruitful than trying to pin blame. Such accidents usually happen because of a series of wrong decisions involving both distant executives and on- the-spot technicians.

    But the paltry Union Carbide payments and the fact that Mr. Anderson was able to find sanctuary in the United States fanned the always latent anti-multinational sentiment in India. It is mirrored in many other developing countries, particularly over corporate mining practices. Multinationals, their critics say, will always get off lightly, thanks to diplomatic pressure or veiled threats that companies will withdraw investment if they are punished.

    In reality, most multinational operations throughout the developing world are run to much higher technical and managerial standards than their local counterparts. India and China have huge numbers of locally owned factories and mines that subject their workers to appalling dangers and where fatalities are common.

    But the United States needs reminding of the paltry penalty one of its leading companies paid for being the source of the worst industrial disaster in history. How many people in the West today want to compare the compensation citizens of India received for loss of life and health with the compensation that is likely to come from BP’s oil disaster in the Gulf of Mexico?