Bhopal Gas Tragedy: A Case Against Globalization?
A question that long bothered me about the Bhopal Gas Tragedy was: How could Union Carbide get away with it? How did Warren Anderson, UCC’s CEO at the time of the tragedy, go scott-free??
Notwithstanding the power asymmetry between the US and India, this seemed too brazen. A US-based global corporation successfully subduing the might of a nation-state!
One would expect the Indian state to fight for the matter to be adjudicated by the Indian courts. The opposite actually happened. The Indian state, engaging an American tort law expert, argued that the matter must be tried by the US courts, because the “Indian courts were institutionally unqualified to deal with claims of this magnitude and diversity” (source).?
While the technology transfer was seamless, India learned the hard way that the legal infrastructure required to regulate such technology cannot be insourced overnight.?
In the US court, Carbide argued the Indian courts do possess the wherewithal to try these types of cases. The judge ruled in Carbide’s favor and transferred the case to India. In India, the Indian side pressed for the liability of a subsidiary to be passed on to the parent company in the “multinational corporation” context. Carbide, in response, defended itself saying no such concept as “multinational corporation” exists (effectively denying its existence as a monolithic company with global presence)!?
To our distress, “the conceptual structure of American corporate law” prevailed over Indian law. As this paper grimly observes: “Globalization is anything but symmetrical in its flows and frictions.”
A tragedy of this kind typically attracts lawyers who wish to represent the victims with the hope of earning money and fame. This is what happened too; many US tort lawyers came down to Bhopal with this very intent. To prevent milking this tragedy for commercial gains, the? Government of India (GoI) took it upon itself to exclusively represent the victims (1985 Bhopal Act). Looks like a noble gesture, doesn’t it?
Just that in May 1989 GoI accepted Carbide’s settlement offer that ended all outstanding claims against Carbide! With this ended the possibility of any further official inquiry in the matter. Could US-based lawyers, with better grip and experience on the highly technological and technical subject, have secured a better deal for the victims? We will never know. What we do know is that the settlement left the victims in the lurch with no closure.??
What compelled the GoI to act thus??
This article argues this happened because, were we to strictly go by the legal agreement, Carbide had absolved itself of any liability in the event of mishap.?
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Strangely, this can be attributed to the Indian state policy rather than cunning on Carbide’s part.?
Due to the then prevailing Companies Act, Union Carbide Corporation (UCC) had to sell 40% of its stake in its subsidiary, Union Carbide India Limited (UCIL), to the government of India. When the tragedy struck, the GoI had about 25% stake in the company.?
The Bhopal plant was modeled on UCC’s plant in Virginia, US, that was seven times bigger. While UCIL could import the plant design from abroad, India’s policy required use of indigenous materials for construction. The article argues the UCC, the parent company, was not fully involved in the designing and implementation. Therefore, “UCC, in its design transfer agreement, legally absolved itself of all responsibility in case of any mishap.”?
Had the trial happened, the GoI would have been in the spotlight too for consenting to such an agreement.?
GoI’s subsequent actions have not lived up to its tall claims of taking up the responsibility of representing victims. No doubt, the victims feel abandoned by the state.?
As if to further substantiate the power asymmetry of globalization, the most positive after-effect of the tragedy happened in the US. The US Congress enacted a Right-to-Know Act in 1986 that required plants with emissions to report the chemicals they released into the environment.?
In a bizarre mix of asymmetric globalization, legal incompetence, and inadequate policy design, the ultimate sufferers were the victims of the tragedy.?
As this paper notes: “The problem with globalization thus far is that it has been narrow in proliferating property rights when in fact it should be accompanied by the globalization of a more substantive set of basic rights. When people’s basic rights are trampled on in the name of the market and economic efficiency, it ought to be considered some form of a crime. Thus, one ought to be able to talk about crimes and globalization.”
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