International Olympic Committee President Jacques Rogge has rejected India's calls to terminate Dow Chemicals' sponsorship deal with the IOC and 2012 London Games and called on the country to recognise Dow's contribution to the Olympic Movement.
The Indian Olympic Association (IOA) has demanded London 2012 terminate its deal with the U.S. firm because of its links to India's 1984 Bhopal gas disaster that killed thousands of people.
Dow will provide the decorative wrap for London's Olympic stadium despite continuing criticism of its involvement.
Responding to a letter from IOA chief Vijay Kumar Malhotra, Rogge replied that while the IOC sympathised with the people of Bhopal, the American chemical giant's values were aligned with those of the Olympic Movement.
"The IOC and LOCOG were aware of the Bhopal tragedy when discussing the partnership with Dow," Rogge wrote in his letter, a copy of which was distributed to the Indian media.
"Dow had no connection with the Bhopal tragedy. Dow did not have any ownership stake in Union Carbide until 16 years after the accident and 12 years after the $470 million compensation agreement was approved by the Indian Supreme Court.
"The Olympic Movement sympathises with the grief of the victims' families and regrets the ongoing suffering people face in the region.
"We only enter into partnerships with organisations that we believe work in accordance with the values of the Olympic Movement. Dow is a global leader in its field of business and is committed to good corporate governance. The company has supported the Olympic Movement for over 30 years...
"We do hope that the Indian Olympic Association is recognising this, while we appreciate the difficult situation you are facing in the country," Rogge added.
Dow denies any responsibility for the accident that activists say killed up to 25,000 people in the aftermath of the leak at a pesticides factory then owned by Union Carbide India Limited (UCIL), a subsidiary of Union Carbide.
Dow only completed a deal to buy Union Carbide in 2001 but campaigners have demanded that it boosts a 1989 compensation package for those affected by the disaster.
A member of the panel that oversees the sustainability of the London Olympics quit last month, protesting the sponsorship deal with Dow.
Malhotra, who has ruled out boycotting the London Games, said on Thursday he was "not convinced" by Rogge's argument.
"We want that IOC should understand and appreciate the feelings and sentiments of the victims and drop Dow as sponsors," Malhotra said in a statement.
Some Indian Olympians have criticised the Dow sponsorship deal while Shivraj Singh Chauhan, chief minister of the state of Madhya Pradesh, of which Bhopal is the capital, has urged the Indian government to boycott the Games over the issue.