India - Case Study

The Bhopal Tragedy and Supply Chain Challenges

TheBhopal gas explosion disaster was agas leakexplosion accident that took place on the night of December 2, 1984 in Bhopal,Madhya Pradesh, India.It led to over 500,000 people who lived nearby in small towns and villages to be exposed to dangerous chemicals from the gas. There were over 2000 people that lost their lives that night and the following weeks and months saw over 8,000 deaths from gas-related diseases.

The majority owner of the factory was Union Carbide Corporation (UCC) which is an American chemical corporation that operated a pesticide plant in Indian. In 1989, the American company paid over $470 million as compensation with victims mainly ending up with $100-$400 for the loss of life or injuries suffered. In 2001, the company sold its business share capital in India and left the country.

The criminal cases filed in the United States against the company and its Chief Executive Officer Warren Anderson who was in charge at the time of the disaster were all dismissed by United States Courts and redirected some cases to Indian courts on multiple occasions to deal with the case between 1986 and 2012.

This case illustrates the challenges of holding accountable the powerful and rich Western owned companies that do business in poor and often corrupt countries to lower the costs in the supply chain and production. It also illustrates why many companies in Western world that make toxic and dangerous but profitable products choose to build plants in very poor countries. What are some of the issues you can identify in this case and who is to blame? Why do you think the international American company that was doing business in India did not get held seriously accountable by the Indian and the American governments? What are the difficulties you think the Indian government faced to hold the company accountable while at the same time protect its own people? Why do you think the people who were affected have felt let down by the Indian government?

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