Mike Froman denies making link between Bhopal and IBRD lending

Michael Froman

United States Deputy National Security Advisor Mike Froman today denied that he had made any link between the Bhopal Gas Tragedy and the Dow Chemicals issue and IBRD lending to India in an e-mail sent by him in July to Planning Commission Deputy Chairman Montek Singh Ahluwalia.

"With regard to recent reports about my private correspondence with Mr. Ahluwalia, I want to make clear that I was not making any link between what are two separate and distinct issues nor issuing a ‘threat’ of any sort – any assertion to the contrary is absolutely wrong, both in intent and in fact," he said in a statement.

Mr Froman said he was dismayed to think that anything he wrote could be interpreted as minimising the toll of the December 3, 1984 Bhopal disaster.

"The human suffering as a result of Bhopal is a terrible tragedy. Resolving the Bhopal issue is for the Indian people to decide. The U.S. does not seek to interfere in this process," he said.

"I value the opportunity I have to work with Mr. Ahluwalia and others in India to strengthen and deepen the ties between our two countries, both bilaterally and through the G20. Such efforts are key to building our strategic partnership and facing our common challenges together for the benefit of both our peoples," he added.

The statement came after media reports in India suggested yesterday that the US was applying pressure on the Indian Government to provide relief to Dow Chemicals.

The reports quoted Mr Froman as saying in a July 30 e-mail to Mr Ahluwalia: ""We are hearing a lot of noise about the Dow Chemicals issue. I trust that you are monitoring it carefully. I am not familiar with all the details. But I think we want to avoid developments which put a chilling effect on the investment relationship."

That e-mail was in reply to one from Mr Ahluwalia in which he had sought American help at the World Bank meeting.

"I wonder if I can enlist your help on a matter relating to India’s borrowing from the World Bank. We are about to hit the arbitrary single borrower limit in IBRD which forces IBRD to cut new lending to India drastically unless the limit is relaxed. You may remember I had mentioned this as an issue when we discussed the IBRD capital increase in G-20. The matter is coming up in the IBRD board audit committee on Monday. The US is a member. The management wants a relaxation for India. The British prime minister was in Delhi yesterday. We raised it with him and he said that the UK ED would be instructed to support us. Could you speak to treasury to get the US ED on our side? At a time when countries are graduated out of soft assistance, it is normal to switch them to IBRD. But we are faced with a sharp reduction...Larry will fully understand. Hope you can help," Mr Ahluwalia had said, according to the reports.

NNN