When Kenyan President William Ruto visited India, he left with an ambitious deal. In a move signaling deeper Indo-Kenyan ties, the Adani Group secured a 30-year contract to manage Nairobi’s Jomo Kenyatta International Airport (JKIA), a strategic gateway for East Africa. Adani also signed a USD 800 million deal to develop power transmission lines across Kenya. However, as Adani expands its footprint, questions arise about its business practices, cronyism with Indian politics, and the potential impacts on Kenya’s economy and sovereignty.
Adani’s rapid rise is inseparable from its close association with Indian Prime Minister Narendra Modi. This “Modani” nexus, as it is sometimes called, has sparked widespread concern in India about the intertwining of political and corporate interests. Since Modi’s rise to power in 2014, Adani’s net worth has soared from USD 8 billion to USD 137 billion in 2023, fueling suspicion that government favors have enabled Adani’s expansion, both domestically and internationally. In Kenya, a country already grappling with debt and unemployment, the arrival of Adani brings both promises and risks.
Adani’s Power over Kenyan Infrastructure: A Risky Bet?
The airport concession hands over significant control of Kenya’s aviation sector to Adani, an arrangement that has spurred debate. This contract effectively places Kenya’s main airport under foreign control for the next three decades, giving Adani the power to influence policy, infrastructure development, and employment decisions. In similar ventures in India, particularly ports and airports, Adani’s projects have sometimes resulted in job losses for local workers, often due to prioritization of expatriate labor and increased automation. Kenyan labor unions are already on alert, voicing concerns over potential layoffs and employment rights.
The power transmission project adds another layer of complexity. While Kenya faces real infrastructure challenges that Adani’s involvement could alleviate, past examples reveal a pattern of local interests being compromised. In Bangladesh and Sri Lanka, Adani projects have prioritized profits for foreign investors, leaving little benefit for the local communities. If history repeats itself, Kenya’s infrastructure, particularly in critical sectors like aviation and power, could be tied to external influence, endangering national sovereignty.
Cronyism or Competence? The Modi-Adani Connection
India’s domestic politics are heavily influenced by large corporations, but Adani’s relationship with the Modi administration stands out. Adani has gained substantial government contracts under Modi’s tenure, from coal mining to infrastructure, resulting in a powerful monopoly. The “Modani” term captures the prevailing notion in India that Adani’s rise is a product of political cronyism rather than purely business acumen.
This perception is not without merit. Since Modi took office, Adani’s companies have expanded aggressively, raising concerns about a “quid pro quo” relationship. In Kenya, Adani’s success has evoked questions about the integrity of the bidding process, with some speculating that political ties may have swayed the decision. Given Kenya’s history of political patronage and corruption, transparency will be crucial to avoid the pitfalls of perceived favoritism that have plagued Adani’s projects in India.
Controversies and Cautionary Tales
The Adani Group has faced its share of scandals. In January 2023, the Hindenburg Report accused Adani of market manipulation and fraudulent practices, causing Adani’s companies to lose over USD 110 billion in market value. The fallout raised questions about the group’s financial stability and cast a shadow on its international ventures. Additionally, a 2019 report found over USD 1 billion in inflated project costs linked to Adani’s coal imports, signaling a pattern of overpricing and potential corruption that could be repeated in Kenya.
Environmental concerns have also followed Adani. In Australia, Adani’s Carmichael coal mine sparked protests over environmental degradation and indigenous rights violations. Kenya, with its rich biodiversity and reliance on natural resources, should consider these issues carefully before greenlighting future resource projects under Adani’s control. If unchecked, Kenya risks environmental harm and social tensions similar to those seen in Australia and India.
Conclusion: Lessons from the Adani Model
Kenya’s agreement with Adani could usher in much-needed infrastructure and energy projects, but there are valid reasons to be cautious. Kenya must demand transparency in contract terms, prioritize local employment, and safeguard its environmental resources to avoid falling into dependency on foreign corporations. While Adani’s ventures promise economic growth, the history of the Adani-Modi nexus is a cautionary tale of cronyism and unchecked corporate power. Kenya must tread carefully to ensure that foreign investments do not erode its autonomy or exploit its citizens.