Posted online: 2010-07-08
A comparative study of six catastrophic events in India and the US spanning the last 26 years provides a good idea on governments’ management and compensation policies. Three disasters occurred in India, namely the Bhopal gas incident, the tsunami and the Mumbai attacks. The first was an industrial accident, the second a natural disaster and the third a terrorist attack. These are compared to three similar incidents in the US, namely the 9/11 terrorist attacks, Hurricane Katrina and an undersea oil spill by BP.
The Bhopal gas tragedy that took place on Dec 2, 1984, killed 3,800 people immediately (the unofficial figure goes up to 16,000) and thousands suffered from the effects of the poisonous gas. It is considered the worst industrial disaster in history. Even now, almost 25,000 people living near the carbide factory are forced to drink poisonous water. The government’s response was shoddy. The judiciary also failed people’s expectations when the SC reduced the importance of the charge and the district court took 26 years to award a sentence. The government settled out-of-court for $477 million instead of fighting for the rightful $3 billion in the US courts, leaving a bitter memory in our minds. In comparison, the BP oil spill that has taken only 11 human lives but severely impacted the environment in the Gulf of Mexico, making even the US President’s position unenviable. Under the US Oil Pollution Act, there is a cap of $75 million for damages. However, the limit does not apply to oil removal costs or damage resulting from gross negligence or federal safety violations. Consequently, under pressure from the US President, BP has declared a $20 billion ‘Spill Response Fund’.
The next category is natural disasters. The tsunami that hit the Andaman and Nicobar Islands and India’s east coast in 2004. While early warnings were not heeded, the government’s response was reasonably good. In contrast, the US government’s response to Hurricane Katrina was poor, which caused havoc in New Orleans and Florida. In spite of prior information, the US government was not able to evacuate all the people. However, there were hardly any deaths in this cyclone and relief and rehabilitation was provided with international help.
The third category is terrorist attacks. First, the Mumbai attack on November 26, 2008. None of the warnings and briefs were considered and the intelligence reports were termed ‘non-actionable’! The attack led to the death of 173 people in shoot-outs. The live broadcast by TV channels was used by handlers besides damaging the government’s reputation. The reaction time by the NSG as well as the state government, including the infamous visit by the CM along with Bollywood stars, is still fresh in our minds. (It is ironic that the same government returned to power, although the CM and Union home minister were removed under public pressure). The compensation by the government amounted to about Rs 19 crore. While Railways paid Rs 10 lakh each to the families of those who died at the station, the government paid Rs 5 lakh. The injured were paid Rs 50,000 each and funeral expenses of those killed were also borne by the government.
The 9/11 terrorist attack in New York and Washington, DC, proved that the US had a shoddy security system. But the US government reacted forcefully, declared it a ‘war on terrorism’, and took on Afghanistan (and not so wisely, on Iraq) in a military effort. The compensation paid in the US was quick and substantial. The US government, by an Act of their legislature, created, without delay, a ‘Victim Compensation Fund’. With 1,600 hearings within 33 months, $7 billion was awarded to over 5,000 people (more than 97% of the families). The average payout for death claims was about $2 million ranging from $250,000 to over $7 million. More than 2,800 injury claims were also paid out, mostly to rescue workers. The claims took into account lost income, insurance, dependents and other factors. The total compensation paid by the government (federal, state and local) and insurance companies exceeded $38 billion.
In conclusion, we can state that while response and compensation in the US’s catastrophic events have been quick and effective, except for that in Hurricane Katrina; India has been tardy and ineffective. Even considering that India is a developing country, the response leaves a lot to be desired. Our policy towards compensation also needs to be made clear and should not be decided on an ad hoc basis.
—The author is chairman of International Foundation of Aviation, Aerospace and Development
A comparative study of six catastrophic events in India and the US spanning the last 26 years provides a good idea on governments’ management and compensation policies. Three disasters occurred in India, namely the Bhopal gas incident, the tsunami and the Mumbai attacks. The first was an industrial accident, the second a natural disaster and the third a terrorist attack. These are compared to three similar incidents in the US, namely the 9/11 terrorist attacks, Hurricane Katrina and an undersea oil spill by BP.
The Bhopal gas tragedy that took place on Dec 2, 1984, killed 3,800 people immediately (the unofficial figure goes up to 16,000) and thousands suffered from the effects of the poisonous gas. It is considered the worst industrial disaster in history. Even now, almost 25,000 people living near the carbide factory are forced to drink poisonous water. The government’s response was shoddy. The judiciary also failed people’s expectations when the SC reduced the importance of the charge and the district court took 26 years to award a sentence. The government settled out-of-court for $477 million instead of fighting for the rightful $3 billion in the US courts, leaving a bitter memory in our minds. In comparison, the BP oil spill that has taken only 11 human lives but severely impacted the environment in the Gulf of Mexico, making even the US President’s position unenviable. Under the US Oil Pollution Act, there is a cap of $75 million for damages. However, the limit does not apply to oil removal costs or damage resulting from gross negligence or federal safety violations. Consequently, under pressure from the US President, BP has declared a $20 billion ‘Spill Response Fund’.
The next category is natural disasters. The tsunami that hit the Andaman and Nicobar Islands and India’s east coast in 2004. While early warnings were not heeded, the government’s response was reasonably good. In contrast, the US government’s response to Hurricane Katrina was poor, which caused havoc in New Orleans and Florida. In spite of prior information, the US government was not able to evacuate all the people. However, there were hardly any deaths in this cyclone and relief and rehabilitation was provided with international help.
The third category is terrorist attacks. First, the Mumbai attack on November 26, 2008. None of the warnings and briefs were considered and the intelligence reports were termed ‘non-actionable’! The attack led to the death of 173 people in shoot-outs. The live broadcast by TV channels was used by handlers besides damaging the government’s reputation. The reaction time by the NSG as well as the state government, including the infamous visit by the CM along with Bollywood stars, is still fresh in our minds. (It is ironic that the same government returned to power, although the CM and Union home minister were removed under public pressure). The compensation by the government amounted to about Rs 19 crore. While Railways paid Rs 10 lakh each to the families of those who died at the station, the government paid Rs 5 lakh. The injured were paid Rs 50,000 each and funeral expenses of those killed were also borne by the government.
The 9/11 terrorist attack in New York and Washington, DC, proved that the US had a shoddy security system. But the US government reacted forcefully, declared it a ‘war on terrorism’, and took on Afghanistan (and not so wisely, on Iraq) in a military effort. The compensation paid in the US was quick and substantial. The US government, by an Act of their legislature, created, without delay, a ‘Victim Compensation Fund’. With 1,600 hearings within 33 months, $7 billion was awarded to over 5,000 people (more than 97% of the families). The average payout for death claims was about $2 million ranging from $250,000 to over $7 million. More than 2,800 injury claims were also paid out, mostly to rescue workers. The claims took into account lost income, insurance, dependents and other factors. The total compensation paid by the government (federal, state and local) and insurance companies exceeded $38 billion.
In conclusion, we can state that while response and compensation in the US’s catastrophic events have been quick and effective, except for that in Hurricane Katrina; India has been tardy and ineffective. Even considering that India is a developing country, the response leaves a lot to be desired. Our policy towards compensation also needs to be made clear and should not be decided on an ad hoc basis.
—The author is chairman of International Foundation of Aviation, Aerospace and Development
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