The Prime Minister of India, Narendra Modi, before next year’s general elections, was cornered by the ‘Adani group scandal’. The opposition’s offensive against rumors of collusion between Prime Minister Modi and Chairman Gautam Adani is intensifying after it was revealed that public companies had made large-scale investments in the Adani Group, whose market capitalization was cut in half due to suspicions of irregularities -calculation.
According to Indian media such as Reuters and ANI on the 7th (local time), anti-government protests related to the Adani group event took place in major cities such as New Delhi, Mumbai and Kolkata the previous day. Hundreds of demonstrators, led by members of the Indian National Congress (INC), the main opposition party in India’s federal parliament, staged a fierce protest, calling for a parliamentary inquiry into the Adani group incident and burning effigies of Prime Minister Modi and Chairman Adani . He was taken away by the police
The opposition disputes the fact that the state-owned Life Insurance Corporation of India (LIC) and State Bank of India (SBI) have invested too much in the Adani group. According to Reuters, LIC has a 4.25% stake in Adani Enterprise, the flagship of the Adani Group, and has also invested in Adani Port (9.14%) and Adani Total Gas (5.96%). SBI invested about 270 billion rupees (about 4.1 trillion won) in Adani Group.
Adani is a leading logistics and energy company in India. Since its establishment in 1998 by Chairman Adani, it has grown into a mega-conglomerate encompassing infrastructure businesses such as port and airport operations, resource development such as coal and gas, distribution, and power businesses in just 30 years. In particular, in the last 1-2 years, in line with the new Modi government’s infrastructure expansion policy, it has grown rapidly and its stock price has soared 1,500%.
Adani Group’s stock price plunged on the 24th of last month after US activist fund Hindenburg Research raised allegations of stock price manipulation and fraudulent accounting. Market capitalization evaporated $ 118 billion (about 148 trillion won). S&P, a global financial information agency, downgraded the credit rating outlook for Adani Port and Adani Electric from ‘stable’ to ‘negative’.
As rumors of collusion with Prime Minister Modi have been raised constantly during the rise of the Adani Group, the arrows of the protests have been aimed at Prime Minister Modi. Chairman Adani and Prime Minister Modi both hail from the western state of Gujarat. Prime Minister Modi served as the Chief Minister of Gujarat from 2001 to 2014, and has been the Federal Prime Minister since 2014. While campaigning in 2014, he boarded an Adani Air private jet and became a sensation.
Both Modi and Adani strongly deny the rumors of collusion. In a recent India Today television interview, Chairman Adani said, “It is a baseless allegation,” and “My professional success is not attributable to any single leader.” The government is also in the position that it has nothing to do with the Adani group issue.
