Union Carbide and India

In 1984, Union Carbide reported sales of $9.5 billion, reflecting its position as one of the largest industrial companies in the United States and the world. International operations represented nearly 30 percent of total sales that year. India was one of three dozen countries where the company had affiliates and business interests.

Divided by industry segments, sales encompassed petrochemicals (28 percent); technology, services, and specialty products (26 percent); consumer products such as batteries, automotive supplies, and plastic wraps and bags (20 percent); industrial gases (16 percent); and metals and carbon products (10 percent).

Financially, 1984 was a good year for Union Carbide. The company was pursuing ambitious commercial plans in the People’s Republic of China. Twelve promising new high- performance specialty products were being marketed. A joint venture with Shell Chemical Company was moving forward. Union Carbide was keeping pace as the U.S. economy recovered from the persistent recession that had begun in 1981.

In 1984, Union Carbide India Limited was celebrating its 50th anniversary. UCIL had sales of about $200 million annually. It operated 14 plants, and was organized into five operating divisions with 9,000 employees. It was a diversified manufacturing concern. The shares of the Indian company, publicly traded on the Calcutta Stock Exchange, were held by more than 23, 000 shareholders. About 24 percent of the shares were owned by government-run insurance companies. Union Carbide Corporation held 50.9 percent of the stock as part of a corporate global business strategy that evolved in the post World War II era. By investing in companies abroad, Union Carbide expected to contribute to — and benefit from — growing national economies around the world.The massive disaster at Union Carbide’s pesticide plant in Bhopal, India, in December 1984 struck the corporation just as it was beginning to make lasting strides toward profitability.

Ironically, the plant at Bhopal had its origin in a humane goal: supplying pesticides to protect Indian agricultural production. The pesticides made at Bhopal were for the Indian market and contributed to the nation’s ability to transform its agricultural sector into a modern activity capable of feeding one of the world’s most heavily populated regions.

In the late 1960’s, operations at Bhopal packaged the pesticide Sevin, then considered an environmentally-preferred alternative to DDT, an insecticide now restricted by the U.S. Environmental Protection Agency.

Later, the Bhopal plant started handling methyl isocyanate shipped from the United States. The process, which reacted methyl isocyanate with another compound, was considered the leading technology for producing Sevin and another pesticide, Temik. The development was part of an active Indian government effort to achieve industrial self- sufficiency.

Ultimately, in the late 1970s those government objectives led to the construction of a plant for manufacturing methyl isocyanate at Bhopal. The plant was located on the outskirts of Bhopal on land leased to UCIL by the Indian state government of Madhya Pradesh.

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http://www.bhopal.com/~/media/Files/Bhopal/browning.pdf