People's Democracy

BHOPAL GAS VICTIMS DEMAND

Five-Fold Increase In Settlement Amount 

The Bhopal Gas Peedith Mahila Udyog Sanghathan (BGPMUS), Bhopal  and the Bhopal Gas Peedith Sangharsh Sahayog Samiti (BGPSSS), Delhi, have heartily welcomed the Supreme Court of India’s decision on July 19, 2004 to recognise the fact that the magnitude of the Bhopal gas leak disaster was five times more than what was estimated at the time of the settlement on February 14/15, 1989. They demanded that the issue of making good the real shortfall in the settlement amount must now be addressed urgently.

Following is the text of the statement released by N D Jayaprakash, Co-convenor of BGPSSS and Abdul Jabbar Khan, Co-convenor of BGPMUS on July 20, 2004:

AS per the order of the Supreme Court dated May 04, 1989, the Bhopal Settlement was based on the assumption that only about 3,000 human lives were lost and about 1,02,000 others had sustained injuries as a result of exposure to toxic gases that had emanated on the night of December 02-03, 1984 from the premises of Union Carbide India Limited (UCIL), a subsidiary of Union Carbide Corporation (UCC), USA. However, according to the 2003 Annual Report of the Bhopal Gas Tragedy Relief & Rehabilitation Department, as on October 31, 2003, the total number of cases awarded compensation by the Claim Courts under the category of death was 15,310 and the number of those cases who have been awarded compensation for injury was 5,54,895. The total amount disbursed as compensation under both the categories until then was around Rs 1,530 crore. The significance of the Supreme Court order dated July 19, 2004 is that the court has given its stamp of approval to the figures of death and injured which have been determined by the claim courts.

It may be recalled that under the Bhopal Settlement, UCC had agreed to pay an amount of US$ 470 million dollar (Rs 710 crore at the then prevailing exchange rate of approx. Rs 15 to $1) as compensation. As per the order of the Supreme Court dated May 4, 1989, 84 per cent of that amount was to be disbursed as compensation to 3,000 cases of death and 1,02,000 cases under four different categories of injuries – from injuries of utmost severity to simple injuries. (16 per cent of it was set aside to compensate those who had lost personal property and livestock.) On October 16, 1992, the Supreme Court gave a clear direction in response to an application filed by BGPMUS that the compensation amount lying in the Settlement Fund would not be used for any purpose other than as compensation to the victims.

Adjudication of claims began in the Claim Courts only from 1992 onwards and the process is yet not complete. Meanwhile, the compensation amount, which was retained in a Dollar Account, not only accrued interest but also appreciated considerably in value in terms of rupees due to the rising exchange rate of the US Dollar vis-a-via the Rupee. (In 1992 the exchange rate was approx. Rs.30 to $1 and by 2000 it had become Rs 45 to $1) Thus, by 2003, despite disbursing about Rs 1,520 crore, almost an equal amount still remained in the Settlement Fund. It was under these circumstances that 30 individual victims filed a petition before the Supreme Court urging the court to issue directions to disburse the remaining amount in the Settlement Fund on a pro-rata basis.

Disbursing the amount on a pro-rata basis did not appear to hurt anyone’s interest since, as per the order of the Supreme Court dated October 16, 1992 the entire Settlement Fund was bound to go to the victims any way. It was under these circumstances that the Supreme Court on July 19, 2004 gave directions to disburse the remaining amount of Rs 1,503 crore on a pro-rata basis to all those who have been awarded compensation till date (after taking into consideration the 16,000 pending cases before the Claims Commissioner.)

However, one crucial issue had not been considered by the court till now. This was brought to the notice of the court on July 19, 2004 by Indira Jaising, senior counsel, who appeared on behalf of BGPMUS and BGPSSS.  Jaising pointed out to the court that the number of those who were to be compensated as per the terms of the US$ 470 million settlement was only 1,05,000. But in fact over 5,70,000 claimants have actually been paid compensation out of the Settlement Fund since the Claim Courts had determined that the magnitude of the disaster was far higher than what was assumed at the time of the settlement. Jaising argued that if, indeed, the 5,70,000 claimants had been paid compensation as per the amounts earmarked for each of the various categories of death and injury as per the terms of the settlement, more than five times the settlement amount would have been required to compensate all of them.

In fact what has happened is that the compensation amounts awarded to over 4,65,000 additionally acknowledged victims have actually come from the compensation amount that should have been legitimately paid only to the 1,05,000 victims for whom it was earmarked. The benefit of rise in exchange rate and accruing interest should also have legitimately gone only to those 1,05,000 victims who were covered under the terms of the settlement, but that never happened. Another glaring anomaly was that, despite five times the number of victims being paid compensation from the amount that had been awarded to 1,05,000 victims, half the amount in the Settlement Fund remained un-disbursed. It is this un-disbursed amount of Rs 1,503 crore in the Settlement Fund that is being released for disbursement on a pro-rata basis as per the court order dated July 19, 2004. Despite an acknowledged increase in the number of victims by an order of five, the original settlement fund was never augmented at all. Therefore, the issue of how to make good the real shortfall in the settlement fund is what needs to be addressed.

The court has permitted BGPMUS and BGPSSS to file an application before it in this regard, which we hope to file within a week.