Singrauli: A case of India’s business-human rights woes

The recent news about toxic ash leak in Singrauli is a much-needed reminder of the lost sense of social responsibility a business entity owes to the local community where it conducts its business operations. On August 7, 2019, a mud wall holding a fly-ash dyke of 2×600 MW Mahan Power Plant, operated by Essar Power Madhya Pradesh Limited (EPMPL), collapsed which allegedly resulted in crop losses to more than 500 farmers and five children being rescued from the mudslide which entered the adjoining villages.

The company in its statement has claimed the breach in the ash pond as “a clear case of sabotage” with the company filing a First Information Report against unidentified persons who were spotted fleeing the site the previous night. EPMPL further added that the land where the ash entered is “non-agricultural land owned by EPMPL” and the villagers are living on the land “at their own risk as encroachers despite repeated requests from EPMPL.”

Singrauli has previously suffered from similar incidents of fly ash-laden water seeping into the adjoining villages. In 2014, the release of fly ash caused direct harm to the villagers because of increased levels of mercury, which is a chemical associated with causing neurotoxicity. The town has already been identified as a critically polluted area by the Union Ministry of Environment and Forests. One of the reasons for its dismal environmental record is because it has emerged as a hub of coal-based thermal power plants with incremental coal mining activities. The rapid growth in industrial activity has created an acute air and water pollution issue.

The cost is usually borne by the community residing around the area and has resulted in a conflict between fundamental human rights of those effected and the expanding role of businesses in a globalised economy. This tension is contextualised within international legal scholarship broadly as issues relating to ‘Business and Human Rights.’

One of the central reference texts of this discipline is ‘The United Nations Guiding Principles on Business and Human Rights’. The Principles provided a focused approach emphasising the three pillars namely: State responsibility to protect, corporate responsibility to respect human rights and the provision of access to remedy in cases of corporate wrongdoings. These three pillars comprise the theoretical framework for holding corporations accountable for wrongdoings. Apart from its aspirational goal of corporate accountability, the text also envisages the goal of progressing towards a rights-compatible form of business activity.

The Principles apply to all states and to all business enterprises irrespective of their size, industry, place of business operations etc. However, one of the major criticisms is that the Guiding Principles are non-binding in nature and are merely “soft laws”.

The question remains: How can we avoid more Singraulis? There is no one solution to this complex question. There needs to be consistent efforts to raise awareness amongst different stakeholders including corporations, state, civil society organisations and right holders regarding various modes of emerging corporate legal liability. The regulatory apparatus needs to be strengthened to ensure respect for human rights, especially of those who are marginalised and vulnerable.

The right to access remedy is one of the pillars of the Guiding Principles which considers “effective judicial mechanisms to be at the core of ensuring access to remedy”. Judicial mechanisms involve courts, national human rights institutions, labour inspectorates and other state as well as non-state based judicial mechanisms. Our existing judicial mechanisms need to be strengthened through a strict enforcement of domestic laws. This must be complemented with a broader understanding of remedy beyond the traditional “fine/compensation model”. The fight to hold corporations accountable for their wrongdoings is limited to paying token compensation with continuing business as usual. Merely providing compensation does not imply acceptance of legal liability for the wrong committed by the alleged corporation.

One of the ways is to establish an effective remedial mechanism such as an operational-level grievance mechanism (OGM) as proposed by Principle 29 of the Guiding Principles. An OGM is an early identification and remediation mechanism established by a business enterprise to remedy any adverse business impact directly with those who might be affected. With an effective OGM in place, companies can avoid the potential legal hassle and secure their human rights obligations.

It must be reminded that corporate negligence cannot be stopped by paying tokenistic monetary compensation or a fine and then continuing the business operations. This attitude contributes to the culture of corporate impunity rather than corporate accountability. There is an urgent need to develop a more robust framework implementing the Guiding Principles. The Ministry of Corporate Affairs has recently released the National Action Plan (NAP) on Business and Human Rights but it still at draft stages. It is nevertheless an important step forward in addressing business and human rights issues.

(Justin Jos is a PhD Candidate at the University of New South Wales, Sydney, Australia)

The views expressed above are the author’s own. They do not necessarily reflect the views of DH.