In Episode #1 of the Adani saga played out in January 2023, a US-based firm, Hindenburg published a report claiming that the Indian conglomerate of Adani Group, led by Gautam Adani, the 3rd richest man in the world has been involved in a brazen stock manipulation and accounting fraud scheme over decades. This report had a catastrophic impact on the shares of Adani Group which tumbled steeply wiping out more than $100 billion of the Adani Group’s market value. The interesting part is that the Hindenburg firm that accused Adani of malpractices earned US$4 million in the process by short selling. Short selling is a strategy employed by shrewd investors to profit from downward price movements by selling borrowed shares at a high price and repurchasing them at a lower price. I recommend the readers to watch the “Scam 1992” series on Sony Liv where Harshad Mehta’s character describes the process of short-selling of shares in the stock market without actually owning them.
In Episode #2 played out in November 2024, the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) indicted Gautam Adani along with a few others in Adani Green Energy for offering US$250 million in bribes to the Indian officials to secure favourable solar power contracts in four Indian states of Andhra Pradesh, Tamil Nadu, Odisha and Chhattisgarh. But as the finer details of the charges emerged the entire hype created by his detractors, especially in India, lost steam. It became clear that these are only insinuations and there is no evidence that actual bribes were paid, except some email correspondence on which charges are framed. The issue of unsealing an arrest warrant by a New York Court may be a procedural follow-up as per the US law that prohibits any US-based company to offer bribes to foreign nationals for obtaining contracts.
While the impact in episode #1 was severe on Adani Stocks, in the second episode people saw the evil design of some vested interests in the USA to put brakes on India’s economic growth by hitting its most enterprising business house. Unlike episode #1 this time all stocks of Adani conglomerate soared after the US indictment. Adani Green Energy soared 6.42 %, Adani Total Gas 5.33 %, Adani Ports 6.4 %, Adani Power 4.17%, Adani Enterprises 4 %, Adani Wilmar 3.23 %, ACC 3 % and Ambuja Cements 2.71 on the BSE. Adani Group announced robust financial health and steady growth through its latest first half of the fiscal year 2025, as per an NDTV report.
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It is no more a case of business rivalry, but it is all geopolitics to provide ammunition to the US stooges in the opposition parties in India. Some vested interest in the USA wants to hit the Prime Minister of India Narendra Modi because of his closeness with Gautam Adani and creating internal disturbances and destabilise our country. It looks like this plan of the US has failed despite the last-ditch effort of the outgoing President Joe Biden after the successful regime change in neighbouring Bangladesh and installing its puppet Muhammad Yunus as a caretaker to corner India.
People may think that Narendra Modi is favouring Adani but most of the projects are in the opposition-ruled states from Vizhinjam Port in Kerala to several other ports in Andhra Pradesh, Tamil Nadu, Odisha, and West Bengal. Businessmen involved in infrastructure development or major projects of the country’s interests or priority like renewable energy need to be close to politicians on both sides, similar to the situation in the US. This ‘closeness’ might involve bribes or can be seen as lobbying, a euphemism for indirect bribes in kind. For example, Donald Trump had vowed to end the electric vehicles mandate, a stand which he softened during 2024 election rallies, and admitted openly in his victory speech that this change of heart was largely due to Elon Musk, Tesla electric cars, CEO endorsement and support for him. The only difference is Musk can lobby with the President of the United States while Adani has to lobby with officials to raise capital in the market. All leaders in the world support their businessmen. For example, the US helps Bezos, Elon Musk, and Zuckerberg, China helps Huawei, TikTok and even owns it, South Korea helps Samsung, Hyundai and Lotte and so on. This is natural for any country to do so.
One can speculate a few reasons for Adani being targeted. He is building top-quality infrastructure in India which is very important to become a developed country. Modi government has invested heavily in infrastructure development to attract global companies and investors to India. The margin profits in infrastructure are less compared to other sectors. That is why Essar, Jaypee, GVK Power and Infra, Gammon India, IL&FS Engineering, and JP Associates have struggled to stay afloat whereas Adani has succeeded and contributed to Indian economy. He is a smart businessman who identified opportunities in ports, logistics, and power generation, especially solar & transmission and ensured that his ventures are successful. He made the best use of the government support to these sectors and adapted to the policy environment. After consolidating his core business, he diversified to related business in modern technologies.
He is competing with Chinese companies globally and winning contracts to build infrastructure in different parts of the world. For example, winning contracts against Chinese bids for coal projects near Jaffna in Sri Lanka, rendering the China Stone project in Australia’s Galilee Basin unviable by scaling down its nearby rail line construction plan so that it would not serve the Chinese plant and outbidding China for leasing Israel’s Haifa port for India strategic plan to counter Belt and Road initiative of China.
USA is also miffed with India when a penalty of Rs.213.14 cores was imposed, a fortnight back, on Meta, an American multinational technology conglomerate based in Menlo Park, California about WhatsApp’s 2021 Privacy Policy, which collected and expanded the scope of data along with mandatory data. Also, a few months ago, Adani cut off the electricity supply to Bangladesh due to non-payment of dues.
All these incidences give credence to the speculations that the real target is not Adani but Narendra Modi who is standing up to the most powerful nations and his increasing stature as a leader of the global south and much sought after as a mediator to broker peace in conflicts, is making the western world uneasy. So, what is the best way to destroy such a formidable adversary, destroy his reputation by attacking close ones?
