‘India should be more interested than US’: Editorials on Adani charges

Adani Group’s chairman Gautam Adani and its seven other executives’ indictment in the US for a $265 million bribery scheme involving government solar energy contracts has triggered a fresh wave of controversy.

A trail of text messages with details of suspicious transactions pointing toward purported bribery have surfaced, while the billionaire businessman’s ties with Prime Minister Narendra Modi are also under the scanner again.

Amid this, what did the editorials say about the controversy surrounding Adani?

The Times of India noted that it’ll be tougher for Adanis this time, given SEC’s charges and potential impact on fund-raising.

“It’s rare for a big corporate group to get caught in multiple controversies over a short time. And when they do, the process of defending yourself itself extracts a cost. And that’s not a good look globally for a conglomerate like the Adani group, with multi-country operations. For the foreseeable future, it’ll be difficult to raise funds in US. Some knock-on effects on other international options for funds won’t be surprising. Even in India, investors in the group, having recouped their previous losses, have been hit again. A certain wariness in the group’s home country can’t be ruled out among investors and lenders. Adanis’ core business is building/managing infra of various kinds. That makes them a capital-hungry group and, therefore, dependent on large funding sources. Those strategising for Adanis will know that Trump in his first term had wanted to scrap the Foreign Corrupt Practices Act, arguing it was unfair to American companies doing business abroad. Hoping for Trump 2.0 to go through with the repeal may not be the best strategy, though. Trump has many other irons in the fire.”

The Deccan Herald said India should be more interested than the US agencies in finding the truth about the charges.

“The Adani group is considered close to Prime Minister Narendra Modi and the BJP but that should not provide the group a shield against charges of misconduct. The group has denied the allegations but a blanket denial is not a credible response. Whenever allegations are raised against the Adani group, the BJP is seen to be directly or indirectly defending it. The party has now said that the law will take its course but the government has the responsibility to ensure that it does. 

“The Opposition parties have demanded a joint parliamentary probe into the charges. The indictment has all the makings of a new Bofors – charges coming from a foreign country, bribe payments for a contract, documents and diary-like records of payment, and code names – though the Congress would be wary of using the B-word.”

The Tribune noted that a Supreme Court-monitored probe is needed to get to the bottom of this murky matter. 

“The indictment has also turned the spotlight on the ongoing probe by the Securities and Exchange Board of India (SEBI) into US short-seller Hindenburg Research’s allegations of ‘brazen stock manipulation and accounting fraud’ by the Adani Group. Ironically, SEBI’s own credibility has taken a hit after its chairperson Madhabi Buch and her husband were accused by Hindenburg of having stakes in obscure offshore entities that were allegedly used in the Adani ‘money siphoning scandal’. Can a fair and transparent probe be expected when the investigator itself is under scrutiny? Buch continues to be at the helm of India’s market regulator, even as she skipped a crucial meeting of Parliament’s Public Accounts Committee last month. There are too many questions awaiting answers, and the Indian government should spare no effort to finally clear the air.”

The Indian Express also pointed to the need for an investigation.

“In the past, questions have been raised over investigations by the Indian stock market regulator into some of the allegations that have been raised against the Adani Group — Hindenburg had previously sought to draw links between what it perceived as regulatory inaction to the Sebi chairperson’s investments. With Parliament days away, the indictment raises questions that need to be answered. Considering that the ripple effects of what happens to the Adani Group can be felt in stock markets and the broader economy — the Adani Group is one of the country’s largest conglomerates, with its business interests spanning a gamut of sectors, from ports, airports, power, including renewables, cement to media among others — all the concerned regulators now need to investigate the allegations raised in a transparent and time-bound manner. The BJP spokesperson’s claim that this could be part of an ‘international structure’ out to undermine the Indian markets isn’t a persuasive answer — it insults the intelligence of the Indian investor.”

The Financial Express said Indian citizens are surely entitled to know whether the bribes were passed on to others and whether SECI was merely a conduit. “The allegations are bound to have wider ramifications for the Adani Group, which borrows heavily in the overseas bond markets, and will hurt its credibility. With lenders likely to become more cautious, the groups’ heavily leveraged balance sheet could be further strained. The bigger question is what the episode will do to tarnish the reputation of India Inc and whether it would have an adverse fallout on companies that tap the international markets.”

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