Adani's reckoning: India and beyond

Sebi may now launch fresh inquiries. Parliament will open to uproar, and Adani's access to foreign capital will become impossible. The damage this time will be deeper and longer-lasting

- SHEKHAR GUPTA

In about two years, the Adani group has hit big international headlines thrice: First, with stories on its debt overhang; second, with the Hindenburg allegations of market manipulation and fraud; and now prosecution by the US Department of Justice, the Federal Bureau of Investigation, the Securities and Exchange Commission—the works. In between the big episodes, there were also some item numbers, like the Supreme Court-mandated inquiry and charges of conflict of interest against Securities and Exchange Board of India (Sebi) Chairperson Madhabi Puri Buch.

All this fouled the air for India's fastest-growing conglomerate without creating either the imminence of criminal action, or jail for its key personnel, or an existential threat to its global ambitions. The latest development has introduced all three.

The US has issued warrants against Gautam Adani, his nephew Sagar, and others named in the indictment. Adani Green Energy has canceled its $600-million (about ₹5,064 crore) international bond issue, and Kenya has withdrawn from nearly $3 billion worth of joint ventures with the group.

This denies the Adani group, an Indian conglomerate with more international hunger than any other, its biggest global venture after the acquisition of the humongous Carmichael coal mine in Queensland, Australia.

The group showed incredible resilience in recovering from earlier setbacks. Of course, the "system" wasn't particularly hostile to it. The big Hindenburg attack sank its follow-on public offer (FPO) to raise ₹20,000 crore. The markets hammered its stocks. At the time, we had framed it as part of the rites of passage for a still-evolving Indian capitalism. That's why we had said the market had won, and it was up to Adani to decide whether he would lose or not.