Battling to regain confidence with investors after a damaging short-seller attack last year, India’s powerful Adani Group has repeatedly flown business partners and journalists to its showpiece “green” project: the northwestern state. An extensive solar and wind farm in Khawada, Gujarat. .
Now Adani’s renewable power business is itself at the center of even more damning allegations against one of India’s largest conglomerates, a sprawling industrial powerhouse whose rise has been fueled by Prime Minister Narendra Modi’s two-and-a-half-decade rise. What is the shadow of the political rise?
US criminal and civil charges accusing the group’s founder Gautam Adani of involvement in a $265 million bribery scheme have shocked Indian businessmen and given powerful ammunition to Modi’s parliamentary opponents.
For international investors, they raise new questions about the integrity and integrity of Indian regulators and business leaders, while casting doubt on the country’s preferred narrative of a rising economy that is underpinned by a corrupt and corrupt China. Offers a safer alternative.
The Justice Department and Securities and Exchange Commission charges could also complicate New Delhi’s relationship with Washington, which has already been overshadowed by claims that Indian officials were involved in efforts to kill Sikh separatists in the United States and Canada.
Since short-seller Hindenburg Research last year accused the Adani group of engaging in “rampant stock manipulation and accounting fraud”, Modi’s opponents have criticized the prime minister for massively undermining Adani, including billions. Seen as their close relationship with leaves.
Many on Thursday called on Indian authorities to follow the example of US agencies and prosecute.
“It is now very clear and established in America that Mr. Adani has broken both American law and Indian law,” Opposition Leader Rahul Gandhi said at a press conference in New Delhi.
“He has been indicted in the United States and I wonder why Mr. Adani is still running around a free man in this country,” Gandhi said, sitting in front of a large portrait of Adani and Modi. He said with a laugh.
A potential extradition request, legal appeals and protracted court proceedings add an unexpected twist to fast-growing but complicated US-India diplomatic, military and trade relations ahead of the inauguration of a new administration led by Donald Trump. can do An extradition treaty between India and the US has been in force since 1999, but is rarely used.
Praveen Chakraborty, an official of Gandhi’s Indian National Congress party, said an arrest warrant had been issued in the United States. “How will it proceed? If the US demands extradition, will Modi protect it? [Adani]And on what basis?”
Gandhi and other opposition politicians specifically pointed to one part of the US criminal indictment. It alleges that in March Gautham Adani and his nephew Sagar Adani, executive director of Adani’s green renewables business, “made or caused the group’s officials to lie to banks and two stock exchanges in India.” made” that he had not received notice from the US Department of Justice. of an investigation.
Chakraborty called the US allegation of misleading investors a “serious offence” that would require action by the stock market regulator, the Securities and Exchange Board of India.
Sebi has previously investigated allegations made by Hindenburg and in the Financial Times and elsewhere accusing Adani of manipulating its own shares, but has not taken any action against the group. In July, Sebi said Hindenburg Research “deliberately sensationalized and distorted certain facts”.
“This is just the tip of the iceberg,” said Mahwa Moitra, another opposition MP who has been a vocal critic of Adani in parliament. “Let’s wait for this fraud and grand theft to be exposed.”
An Indian government spokesperson and Sebi did not respond to requests for comment. The Adani group has called the US allegations “baseless” and said “all possible legal recourse will be taken”.
The allegations against Adani come at a time when India’s credibility as a like-minded business and diplomatic partner for Western democracies is already being questioned.
Canadian Prime Minister Justin Trudeau has said there are “credible allegations” of India’s involvement in the killing of Sikh separatist Hardeep Singh Najjar in Vancouver last year. The US last month charged an Indian “senior field officer” with directing a botched plot to kill a Sikh activist in New York City.
While India has expelled Canadian diplomats and responded strongly to Ottawa’s claims of extrajudicial killings, it has been more cautious with the US, whose officials have demanded accountability from their Indian counterparts.
“So far, the US and India have successfully shared the fallout from allegations related to India’s ‘kill-for-revenge’ scheme,” said Malin Vishnu, “but the allegations against several high-ranking Adani officials have created a new source of tension.” Will do.” Director of the South Asia Program at the Carnegie Endowment for International Peace.
“Given that the charges are being brought in the middle of a presidential transition, I suspect there are already back-channel discussions to request the incoming Trump administration to drop the DoJ and SEC cases,” Vishnu said. has been.”
Some Indian businessmen speculated that the fallout from the charges in India would be limited, with Modi’s government likely to try to protect a friendly business group that has backed projects central to the prime minister’s infrastructure campaign from legal action in both India and the United States. save from
A CEO, who asked not to be identified, suggested that it would be unfair to judge all of corporate India from a single case.
“My instinct is that it doesn’t hurt the reputation or ethos of Brand India or the regulator that you can build businesses in India that stand up and grow and survive,” the CEO said.
In a post on social media site X last week, Adani congratulated Trump on his election and said his group is committed to investing $10 billion in US energy and infrastructure projects and aims to hire 15,000 people. Jobs are to be created. The post was accompanied by an AI-generated panorama showing American and Indian flags flying over a city with a port, railways and elevated highways.
Michael Kugelman, director of the South Asia Institute at the Wilson Center, an American think tank, said that if US-India relations “can survive the charge of murder-for-hire against New Delhi, they can certainly survive this new revelation.” are”. “President-elect Trump may see Adani as an ally: a fellow businessman who has admired Trump, is close to Modi, and has promised to invest and create jobs in America.”
