By S. N. M. Abdi, South China Morning Post

Activists said the Maine-based firm, Holtrachem, had been able to export stockpiles of the toxic metal because of India's lax safety rules. The plant, which used mercury to manufacture chlorine and caustic soda, recently closed.

Madhumita Dutta, co-ordinator of the New Delhi-based non-governmental organisation Toxics Link, said: "The deadly consignment will deal a severe blow to the fledgling campaign by Indian groups to frame rules for handling existing mercury contamination and to find alternatives to mercury."

Activists said mercury was being rapidly phased out in the US, where scientific research had established that it had adverse effects on the brain, spinal cord, kidneys and liver.

Citing statistics prepared by the National Academy of Sciences, they said

60,000 babies were born in the US every year with below-average IQs and learning disabilities because their mothers had consumed mercury-contaminated fish or seafood.

But authorities in New Delhi said that since mercury was still a legally traded metal in India, the consignment from the US could not be blocked.

"Under Indian laws, imports of mercury waste are banned, but there is still no bar on refined or reprocessed mercury - although we strongly advise all commercial and industrial users of mercury to find substitutes," said Dilip Biswas, chairman of the Federal Government's Pollution Control Board.

Ms Dutta said that although the identity of the importer was not yet known, mercury was widely used in India for thermometers, barometers and water treatment.

The biggest thermometer factory is in Kodaikanal in south India, while Gujarat and Tamil Nadu have several caustic soda and chlorine manufacturing units.

She said Indian groups were working closely with international organisations such as Greenpeace and the Basel Action Network, which picketed Holtrachem's plant to halt shipments of America's unwanted mercury to India.

"It is deplorable that an American company is sending to India a highly toxic substance that people in the US do not want to live with. This is nothing but toxic imperialism," said activist Ravi Agarwal.

"They don't want to expose their workers and their environment, although they have hi-tech facilities for coping with a mercury spillover. In India, we have virtually nothing to fight a spillover."

In the worst chemical accident in India, a poisonous gas leak at a Union Carbide pesticide plant in Bhopal killed 2,500 people and paralysed or blinded more than 50,000 in 1984.