The report, released by the New Delhi-based environment group, Centre for Science and Environment (CSE), says imports of the toxic compound have gone up six times in the last seven years.

While many developed nations have begun to discard mercury because of its toxic effects, India today accounts for 50 percent of the global consumption of mercury, and processes 69 percent of all the mercury in the world.

"We are rapidly becoming the toxic dumping ground of the world's mercury," says CSE director Sunita Narain. "We will become the world's dirt capital," she says.

Experts stress that mercury contamination can lead to brain damage and affect the health of a fetus. It can adversely affect the central nervous system, lungs and kidneys.

CSE has found high mercury contamination in surface water, groundwater, human hair, blood and in fish. It found 0.182 milligrams (mg) of mercury contamination per liter of water in Singhrauli in Uttar Pradesh in the north, and 0.268 mg per liter in Panipat in the northern state of Haryana. The permissible level is 0.001 mg per liter of water.

"There is sufficient evidence that mercury puts human beings at risk, particularly the weak and susceptible populations," says R C Srivastava, former deputy director of the Industrial Toxicology Research Centre, based in the northern Indian city of Lucknow.

India imported 531 tons of mercury in 2002, up from 254 tons in 1996, the report says, quoting government figures. During the same period, the import of organo-mercury compound - used in pesticides and biocides - went up by a whopping 1,500 times - from 0.7 ton to 1,312 tons.

Though it has some 3,000 industrial uses, mercury is mostly used in the caustic soda and chlorine manufacturing chlor-alkali industry. CSE says the chlor-alkali sector is the single largest mercury consuming industry in India, consuming about 70 tons of mercury each year.

Mercury is also used for producing batteries, thermostats, thermometers, barometers and electrical appliances such as mercury vapor lamps, electrical switches and fluorescent lamps.

Significantly, the report points out that India's mercury imports are on the rise at a time when Europe and the US are regulating or even discarding its use. The US is gradually bringing down its consumption, consuming 346 tons of mercury in 1998.

Europe is phasing out its mercury-based chlor-alkali plants and is going to discard 13,000-18,000 tons of the toxin on the market. Already, Europe has sold over 3,000 tons of mercury to India.

"India has become the prime destination for sellers of death and disease," says CSE associate director Chandra Bhushan.

The report points out that there are mercury-free alternatives that are readily available and can replace the use of mercury.

For instance it says the chlor-alkali industry, can switch to the membrane cell process now being used in many developed countries instead of mercury. "But India has chosen to invest in what the world has discarded," CSE says.

CSE rues the fact that the Indian government does not have comprehensive data on the use of mercury in a country of one billion people.

The environment group has called for a regulatory body - and "a tough policy" - to restrict and regulate mercury emissions. "We don't even know how much mercury we use, how we use it, and where we use it," it says.

Mercury is toxic because it cannot be broken down into harmless components. It combines with carbon to form the poisonous methyl mercury, which passes into the air, soil and the food chain, mostly through fish.

"The use of mercury is putting entire populations at risk," CSE says. "The lives of Indians are not expendable. They are not less valuable than the lives of the people who live in Europe, US or Japan," it says.