Wednesday, October 6, 2010

at its low

At last the agrochemical major Dow Agro Sciences (DAS), a subsidiary of Dow Chemical of the US has faced the ire of Agriculture Ministry, with imposition of ban on all its commercial activity, which excluded it from the purchase of pesticides for the next five years for unlawful practice of bribing Indian officials. It bribed the officials to expedite the approval of three of its substandard pesticides. The three pesticides were identified as Dursban 10G, Nurelle-D and Pride, used for controlling of pests of crop like cotton and oilseeds.

But the action followed after a lot of dilly dally by the Agri Ministry, when it is asked by the GoM, looking into the Bhopal Gas tragedy sought to know the status of the show-cause notice. The ministry, in its response, cited the result of the CBI probe into the case, and its recommendation that the firm be blacklisted. In an effort to cover all its flanks, the agriculture ministry had, before issuing the show-cause notice, also sought the views of the law ministry. The later, in its response, asked it to take the registration committee on board. The direct role of ministry in the whole accreditation and certification process should be investigated to look for the bigger fishes, pursuing corrupt and unethical practices by dint of position and government office.

In June, the agriculture ministry issued a show cause notice, asking why Dow should not be blacklisted for having indulged in unethical practices. The ministry also asked the registration committee of Central Insecticide Board and Registration Committee (CIBRC) to review the registration of these three pesticides afresh. Since DAS India has not presented and justified its position to the notice in a meaningful and appropriate reply, the action followed.

The charge sheet was filed on the basis of information furnished by the US authorities to the Indian government in response to a letter rogatory. Is the Indian government and ministry gone so hapless and toeing the US lines that only after action from a foreign soil and influence it gets charged. The US Securities Exchange Commission (SEA) had indicted Dow AgroSciences long ago in 2007 and fined Dow Chemical $325,000 for bribing the officials in India, and charged the company of violations under the Foreign Corrupt Practices Act for letting its subsidiary use funds for illegal activities.

The CBI team investigating the case had earlier found out that Ratan Lal Rajak, a former plant protection advisor to the government, and his aides had been paid $32,000 in cash and jewellery, while their travel and hotel expenses were also picked up by Dow Agro Sciences, and at that time it was being known by the name of DE-Nocil Crop Protection Ltd. It later filed chargesheets against Rajak and a middleman, identified only as Satyabroto Banerjee, in the court of a special judge in Ambala (Haryana) for accepting bribes from Dow Agro. Mr Kevin Aden, the then managing director of Dow Agro, a British citizen was also mentioned in the charge sheet for corrupt deals.

The ban has unearthed many of the truths behind the approval and the licence-permit raj, prevalent in the ministry and Indian government. The jurisprudence observed in this case, is the height of maneuverality, as the company in question instead of responding to the notice, questioned the government’s jurisdiction in seeking action against it. The multinational has even employed stalling tactics, as per an anonymous ministry official, but the company directly refutes the charges leveled for. In many other countries also, Dow Chemicals is facing the ban and penalty for its unscrupulous and unethical activity, like in US fined $2 million by the New York Attorney General for falsely advertising the safety of chlorpyrifos.

Many other corporations and multinationals too have very dubious accounts on many of the fronts for their substandard products, particular the agri inputs, i.e. seeds, pesticides etc. and tried under courts for the cases of fraud and imprudent practice, spreading across the boundaries. Being powerful and wealthy, they have developed strong MNC lobby, in lieu of direct funding to the political parties, developmental and anti-lobbyists groups.

Concerned ministry and government authority should act in a fairly transparent way of all the transactions and accreditation process, so that the large section of the society should not suffer at the cost and misdeeds, of a few. But the big question is where the line should be drawn between corporate responsibility, and the responsibility of other agents, such as the governments of developing countries or the international community? These key issues need to be addressed urgently; otherwise the cases of such corporate bankruptcy and social frauds and bound to be unraveled.

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