Congress Asks Questions on Ketan Parekh-Adani Group Links, JPC Probe

Moneylife Digital Team 14 February 2023

Economy & Nation

In the eighth instalment of questions under the series,' Hum Adani Ke Hai Kaun' (HAHK), the Congress party has asked three questions related to the alleged link between the Adani group and tainted stockbroker Ketan Parekh (KP) and an inquiry by a joint parliamentary committee (JPC).

Jairam Ramesh, member of Parliament (MP) and general secretary for communication of Congress, says, "Recent revelations indicate that the convicted stockbroker Ketan Parekh may still maintain links with the Adani group. A close relative of his has worked with Elara Capital, the firm whose India fund had 99% invested in Adani stocks. Elara also is known to have had a relationship with the chartered accountant Dharmesh Doshi, a Parekh associate who absconded from India in 2002."

The three questions raised by Congress are…

(1) A 2007 SEBI ruling following an investigation into excessive volatility in the shares of Adani Exports (now known as Adani Enterprises) between 1999 and 2001 had found that entities associated with notorious stock manipulator Ketan Parekh (KP) had indulged in "manipulative activities such as synchronized trading/circular trading and creation of artificial volume to influence the price in the scrip of Adani." It also found that the "promoters of Adani group aided and abetted KP entities in manipulating the market." This bears a disturbing resemblance to the current allegations against the Adani group, the difference being that the stock manipulation is now being done by opaque offshore entities. Why did SEBI tolerate an even more extreme rise in Adani group stock prices after 2020 without investigating it with the required seriousness?

(2) Recent revelations indicate that the convicted stockbroker Ketan Parekh may still maintain links with the Adani group. A close relative of his has worked with Elara Capital, the firm whose India fund had 99% invested in Adani stocks. Elara also is known to have had a relationship with the chartered accountant Dharmesh Doshi, a Parekh associate who absconded from India in 2002. Given the serious allegation that Elara is a front for the Adani group, is the government turning a blind eye to fresh collusion between Parekh and the Adani group, a relationship that goes back almost 25 years?

(3) Both Indian National Congress- and Bharatiya Janata Party-led governments have in the past agreed to set up a joint parliamentary committee (JPC) to investigate large-scale cases of stock market manipulation. In 1992 a JPC was set up to look into the Harshad Mehta case while in 2001 a JPC investigated the Ketan Parekh case. Both PM Narasimha Rao and PM Atal Bihari Vajpayee had the confidence and trust in elected representatives to investigate scams that affected crores of Indian investors.

What are you afraid of? Do you fear that a truly independent investigation might implicate you personally in the Adani group's wrongdoings?

Read about the previous questions from here: Congress Asks 3 Questions on Adani's Monopoly in Ports, Airports

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