In the seventh instalment of questions under the series,' Hum Adani Ke Hai Kaun' (HAHK), the Congress party has asked three questions related to the Adani group's rapidly expanding monopoly in the ports sector. Congress started asking three questions every day from 5 February 2023.
Jairam Ramesh, member of Parliament and general secretary for communication of Congress, says, "Amid the allegations against the Adani group, the Modi government has maintained a loud silence which smacks of collusion. The Congress party will pose three questions a day to the prime minister (PM)."
The daily set of three questions is related to a particular subject related to the Adani group. For example, on the first day, Congress raised queries on Panama and Pandora's papers on financial flows to and from offshore tax havens. From energy and airports to the role of regulators, the Opposition party poses three questions for the PM. So far, neither the PM nor anyone from the Union government has answered any of these questions.
Here are the 21 questions (so far) asked by Congress...
1. Vinod Adani, the brother of Gautam Adani, was named in the Panama Papers and the Pandora Papers as someone who operates offshore entities in the Bahamas and the British Virgin Islands. He is alleged to have engaged in 'brazen stock manipulation' and 'accounting fraud' via 'a vast labyrinth of offshore shell entities'. You have spoken often about your sincerity and 'niyat' in fighting corruption and even subjected the nation to the heavy costs of demonetisation. What does the fact that a business entity you are well acquainted with faces serious allegations tell us about the quality and sincerity of your investigations?
2. Over the years, you have misused agencies like the enforcement directorate (ED), central bureau of investigation (CBI) and the directorate of revenue intelligence (DRI) to intimidate your political opponents and to punish business houses that do not fall in line with your cronies' financial interests. What action has been taken, if ever, to investigate the serious allegations made over the years against the Adani group? Is there any hope of a fair and impartial investigation under you?
3. How is it possible that one of India's largest business groups, one that has been allowed to build monopolies in airports and seaports, could have escaped serious scrutiny for so long, despite persistent allegations? Other business groups have been harassed and raided for much less. Was the Adani group essential to a dispensation that has profited from 'anti-corruption' rhetoric all of these years
4. Your government has a track record of bailing out failing disinvestments such as IDBI Bank, New India Assurance and General Insurance Corporation using LIC's (Life Insurance Corporation of India's) funds. It's one thing to bail out public sector companies and quite another to use the savings of 300mn (million) loyal policy-holders to enrich your friends. How did LIC make such a heavy allocation to the risky Adani group that even private fund managers had steered clear of? Is it not the duty of the government to ensure that vital public sector financial institutions are more conservative in their investments than their private sector counterparts? Or was this another case of your 'Mann Ki Banking' to benefit your cronies?
5. The allegations of fraud and money laundering against the Adani group have been known for some time. There have been many questions over who are the ultimate beneficial owners of major funds investing in the Adani group. There have been as many as four major fraud investigations, including one by the Securities and Exchange Board of India (SEBI) into the true ownership of its offshore investors. Given this knowledge, did anyone in the prime minister's office (PMO), ministry of finance Or the LIC itself raise any concerns about these questionable investments? Were such concerns overruled and, if so, by whom?
6. After the first selloff following the Hindenburg allegations, the value of Adani group stocks held by LIC fell by Rs32,000 crore, bringing the value of those holdings to Rs56,142 crore on 27 January 2023 by LIC's own admission. Since then, several Adani infrastructure stocks have further crashed by another 50%. Will you share the true extent of LIC's losses from its Adani investments after 24th January? The listed price of LIC itself has fallen by 14% in the past two weeks compared with a dip of 2% in the Nifty50 index. As LIC's misguided Adani investments are eroding the confidence of its 3.4mn retail shareholders, what steps will you take to ease their concerns.
7. What is the relationship between the PM and Adani? How many times did the PM travel with Adani on foreign tours? How many times did Adani join you later on a visit? How many times did Adani travel to a country immediately after you visited the country? How many times has Adani won a contract in a foreign country after your visit there?
8. US-based investor firm Hindenburg Research's report says Adani has several shell companies abroad. Who own these shell companies in Mauritius? Adani works in strategic sectors, and the government must find out about theseshell companies and who controls them, as this is a national security issue. Be it maintenance of aircraft, small arms or drones, the whole India-Israel defence ties have been handed over to Adani. Therefore, the government must find out about these companies working in the ports-airports-defence sector.
9. How did Adani's net worth increase from US$8bn (billion) to US$140bn between 2014 and 2022? In 2014, he was in the 609th spot on the list of wealthiest people and climbed to the second spot. How did this magic happen? How much money has Adani given to BJP during the past 20 years? How much (money) is paid through electroral bonds?
10. In 2006, the United Progressive Alliance government awarded concessions to the GMR and GVK groups to operate Delhi and Mumbai airports, respectively, for a period of 30 years. On 7 November 2006, the Supreme Court upheld these privatisations along with the condition that each bidder needed to partner with an experienced airport operator. Even though GMR had emerged as the top bidder in both cases, it was decided not to award both to the firm in the interests of competition.
In 2019, rights to operate Ahmedabad, Lucknow, Mangalore, Jaipur, Guwahati and Thiruvananthapuram airports were awarded to the Adani group, with zero prior experience operating airports, for a period of 50 years. On 10 December 2018, a NITI Aayog memo argued that "a bidder lacking sufficient technical capacity" could "jeopardise the project and compromise the quality of services the government is committed to provide." It pointed out that the model Request for Quotes (RFQ) document already gave points for project experience outside the airports sector, but that experience in the airports sector was important. A government official quoted in an earlier news report (dated 22 April 2018) had stated that the PMO had "directed" the department of economic affairs (DEA) in the ministry of finance and the NITI Aayog to prepare model concession agreements for airport privatisations. Why did the PMO and the NITI Aayog chairman who headed the empowered group of secretaries (EGS) ignore this recommendation and facilitate a clean sweep of six airports by the inexperienced Adani group?
11. On the same day as the NITI Aayog filed its objection, a note from the DEA had strongly recommended that no more than two airports be awarded to a single bidder to reduce risk and to facilitate competition, as was the case with the Delhi and Mumbai airports privatisations. Yet this too was ignored by the ruling dispensation in its rush to help its cronies. Who instructed the EGS to set aside this prior condition, thus clearing the way for the Adani group to build a virtual monopoly in the sector?
12. The Adani group's takeover of Mumbai airport should be a case study in crony capitalism. The GVK group had vigorously contested the Adani group's attempts to buy a stake in Mumbai airport in 2019, going to the courts and raising funds to buy out its joint venture partners Bidvest and ACSA. Yet in August 2020, only one month following raids by the CBI and ED, GVK felt compelled to sell its most valuable asset to the Adani Group. What happened to the CBI and ED investigations against GVK? How did they miraculously disappear after the sale of Mumbai airport to the Adani Group? Are those cases being used to apply pressure on GVK to defend the very group that forced it to divest India's second busiest airport?
13. There are serious charges of 'brazen stock manipulation' against the Adani group. The collapse in publicly-listed stock prices following the publication of these allegations has financially damaged the lakhs of retail investors who invested in Adani group stocks after being duped by artificially-inflated prices. The value of Adani group stock crashed by Rs9,50,000 crore between 24th January and 6 February 2023. On 19 July 2021, the ministry of finance had admitted to Parliament that the Adani group was under investigation for violating SEBI regulations. Yet Adani group stock prices were allowed to spiral after that. When will SEBI be held accountable for this serious lapse and for allowing the destruction of huge retail savings? Did the Modi government put pressure on SEBI to go slow in its investigation?
14. For all your talk of cracking down on illicit flows of black money, your favourite business group is alleged to have manipulated stock prices using offshore shell companies and related parties posing as investment funds to bypass SEBI regulations. One of the egregious cases is that of the Monterosa group that has owned as much as US$4.5bn (billion) (Rs37,000 crore) of Adani group stock. The CEO of this supposedly independent firm is allegedly linked to a fugitive diamond merchant whose son is married to Vinod Adani's daughter. Other large funds are known to invest almost exclusively in Adani group companies, which is unusual for an investment fund. Take Elara Capital, in which former conservative minister Jo Johnson, brother of former PM Boris Johnson, was until recently a director. Elara held some US$3bn (Rs24,300 crore) worth of stock almost exclusively in the Adani group. The ministry of finance told Parliament that SEBI had frozen the accounts of certain funds operated by the Monterosa group in 2016, but no further action is evident. What has SEBI done to properly investigate these dubious benami companies? If not, what is the leverage that the Adani group exercises that has prevented the full force of India's regulators and investigative agencies from unravelling the truth? What did Gautam Adani discuss in person with SEBI chairperson Madhabi Puri Buch in October 2022?
15. The inclusion of Adani Enterprises in the widely used National Stock Exchange (NSE) Nifty 50 index in September 2022 proved controversial. It had questionable fundamentals, an excessive price-to-earning ratio and a tiny free float. Adding Adani Enterprises compelled seemingly conservative Nifty index funds to make significant purchases of this risky stock, including the employees provident fund organisation (EPFO), India's largest pension fund. In recent days, global stock indices have suspended Adani group companies while the matter is investigated, but the NSE has failed to take any similar action to protect investors. Is it not SEBI's responsibility to protect investors by taking strict action? Is there pressure from the PMO on the NSE and SEBI to go easy on Adani in an effort to bail it out?
16. The three farm laws you enacted in September 2020 met widespread opposition from the farmers of India, which forced you to repeal the black laws in November 2021. One of the biggest beneficiaries of the farm laws would have been Adani Agri Logistics. But even in the absence of the farm laws, Adani has become the major beneficiary of the Food Corporation of India's silo contracts, the most recent award being one to set up 350K (thousand) metric tonnes of storage in UP and Bihar. Meanwhile, Adani Farm-Pik has built a near-monopoly on apple procurement in Himachal Pradesh. Is there any sector of Indian agriculture that you have not tried to hand over to the Adani Group?
17. Renewable energy is yet another promising sector whose main goal for you seems to be to help Adani. On 14 June 2022, the Adani group announced that it would invest US$50bn in green hydrogen in a strategic alliance with France's TotalEnergies. Lo and behold, on 4 January 2023, the Union Cabinet approved the National Green Hydrogen Mission with an outlay of Rs19,744 crore to subsidise Adani. TotalEnergies has since suspended its participation in this venture, but is there any Adani business announcement that is not followed up with a major taxpayer-funded subsidy?
18. You successfully handed over six out of six airports to the Adani group in 2019 by removing the condition that no single operator would be given more than two airports. In your 'Mitr Kaal' budget speech on 1st February, finance minister Nirmala Sitharaman announced that 50 more airports, heliports and water aerodromes would be revived in the next stage. How many of these will Adani end up winning? Will you restore the UPA-era rule that limited how many airports a single operator would be given to ensure competition, or will you continue to expand Adani's airports' monopoly?
19. The Adani group today controls 13 ports and terminals that represent 30% of India's port capacity and 40% of total container volume. It is no surprise that this growth trajectory has accelerated since 2014. In addition to Mundra Port in Gujarat, recent acquisitions include:
2015: Dhamra Port, Odisha
2018: Kattupalli Port, Tamil Nadu
2020: Krishnapatnam Port, Andhra Pradesh
2021 Gangavaram Port, Andhra Pradesh
2021: Dighi Port, Maharashtra
There is a clear strategy at work: Gujarat, Andhra Pradesh and Odisha account for 93% of the overseas cargo traffic from India's 'non-major ports'. Krishnapatnam and Gangavaram are the largest private ports in the south. The Adani group has declared its goal as expanding its market share to 40% by 2025 and is attempting to acquire even more ports. Do you intend to oversee the takeover of every significant private port by your favourite business group or is there any space for other private firms that wish to invest? Is it prudent from a national security perspective appropriate for a firm that faces serious accusations of money laundering and round-tripping by offshore shell companies to be permitted to dominate a strategic sector like ports?
20. As with airports, your government facilitated an Adani monopoly in the ports sector using all the means at its disposal. Ports with government concessions have been sold to the Adani group without any bidding. And where bidding has been permitted, competitors have miraculously vanished from bidding. Income-tax (I-T) raids appear to have helped ‘convince’ the previous owner of Krishnapatnam Port to sell it to the Adani group. Is it true that In 2021, the public sector Jawahal Nehru Port Trust (JNPT) was bidding for the Dighi port in Maharashtra in competition with Adani but was forced to withdraw its winning bid after the ministries of shipping and finance changed their mind about supporting its bid?
21. Generally, port concessions are negotiated with special purpose vehicles (SPV) for each port to segregate risks and protect assets. Yet, many of these ports are now part of a single listed entity, Adani Ports and SEZ. Has this transfer of assets been done in violation of the model concession agreement for ports? Have the concession agreements been changed to accommodate Adani's commercial interests?