Billionaire Gautam Adani Indicted in New York on Bribery Charges
Indian billionaire Gautam Adani, alongside seven other executives, has been indicted in New York on allegations of orchestrating a multimillion-dollar bribery and fraud scheme tied to solar energy projects. This development has cast a shadow over the Adani Group, one of India’s most prominent conglomerates, and stirred political tensions back home.
The Allegations
The U.S. Department of Justice (DOJ) alleges that Adani, a close ally of Indian Prime Minister Narendra Modi, and his associates offered over $250 million in bribes to Indian government officials to secure lucrative solar energy contracts. These contracts, spanning 2020 to 2024, were projected to generate over $2 billion in after-tax profits over 20 years.
Deputy Assistant Attorney General Lisa Miller, in a statement, accused the defendants of using bribery, fraud, and obstruction of justice to manipulate contracts and deceive investors. “Senior executives and directors of these companies allegedly committed crimes to secure massive energy supply contracts through corruption, all at the expense of U.S. investors,” she stated.
Evidence cited in the indictment includes phone records, detailed financial analyses, and documents outlining bribe amounts and payment strategies.
Impact on Adani Group
The allegations have dealt a significant blow to the Adani Group. Shares in the group’s listed companies plummeted between 10% and 20%, erasing nearly $30 billion in market value within a day. Adani Green Energy, a subsidiary implicated in the case, has postponed a $600 million bond sale, citing the ongoing legal developments.
The Adani Group has denied the charges, calling them “baseless” and reiterating its commitment to transparency and regulatory compliance. In a statement, the group assured stakeholders of its adherence to legal norms and governance standards.
Political and Economic Repercussions
The indictment has reignited political debates in India. The Indian National Congress, a key opposition party, renewed calls for a parliamentary probe into the Adani Group’s operations, highlighting the alleged proximity between the conglomerate and Modi’s government.
Globally, the case underscores the increasing scrutiny of business practices in the clean energy sector. The Securities and Exchange Commission (SEC) has also filed civil charges against Adani Green Energy executives, accusing them of misleading investors to raise $175 million based on fraudulent contracts.
A Troubled Year for Adani
This indictment adds to a challenging year for Adani. In January 2023, U.S.-based Hindenburg Research accused the group of stock manipulation and accounting fraud, leading to an $80 billion drop in Adani’s net worth. While the group issued a 400-page rebuttal dismissing the claims, the fallout damaged its reputation.
Adani, once among the world’s richest individuals, built his empire from modest beginnings in diamond trading before venturing into ports, power, media, and renewable energy. Despite this latest setback, the billionaire remains a pivotal figure in India’s economic landscape.
A Test for Corporate Governance
The case against Adani not only challenges the group’s operations but also raises broader questions about corporate governance and investor protection. With U.S. and global regulators watching closely, the outcome of this case could have far-reaching implications for international business dealings in emerging markets.
