Adani in trouble

THE Adani Group’s credibility has come under a cloud for the second time in as many years. While the conglomerate managed to weather the Hindenburg storm to a great extent, it is facing far stronger headwinds this time. The indictment of Gautam Adani, one of the world’s richest people, by US prosecutors has made the shares and bonds of the group’s firms take a tumble. The group has rejected the allegations of bribery and fraud as ‘baseless’, but it has to brace itself for what could be a prolonged legal battle.

The development has given the Opposition fresh fodder to target the Narendra Modi government over crony capitalism, while the BJP has trained its guns on parties that were in power in states where government officials allegedly received bribes. A Supreme Court-monitored probe is needed to get to the bottom of this murky matter. It would require close cooperation not only between the Centre and states but also between the Indian and US authorities.

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.