Supriya Sharma & Ayush Tiwari
The Kenyan high court last week suspended a proposed deal that would have given the Adani Group rights to run the Nairobi airport for 30 years – its first airport venture outside India. The court order is a setback to the group’s plans to expand its global footprint.
Notably, this expansion has closely followed in the footsteps of Prime Minister Narendra Modi’s diplomatic engagements. Most Adani projects outside India, whether in the neighbourhood or further afield, were announced within months of Modi visiting the country or meeting its head of state, Scroll’s analysis shows.
The Kenyan prime minister, for instance, visited New Delhi in December 2023. Three months later, in March, the Adani Group submitted a proposal to upgrade and expand the Nairobi airport. In June, the Kenyan authorities changed the national aviation policy and approved an airport investment plan.
After whistleblower documents brought this to light, the Kenyan Human Rights Commission and the bar association filed a legal challenge, arguing that “leasing a strategic and profitable national airport to a private entity is irrational”, more so because it was being done in secrecy, without any competitive bidding. The High Court temporarily halted the proposed deal on September 9.
As questions were raised in the Kenyan Parliament and criticism mounted on social media, a government advisor said no contract had been awarded to Adani for the airport but the group has been granted concessions worth $1.3 billion to construct high-voltage power lines in Kenya.
The furore in Kenya comes at a time when the interim government in Bangladesh has said it was reviewing a power purchase agreement with Adani, which is widely seen as being tilted in favour of the conglomerate. This deal, too, followed in the wake of Modi’s diplomacy.
On his first visit to Dhaka as prime minister, in June 2015, Modi said India could be a major partner in helping Bangladesh fulfil its electricity needs. Two months later, Adani signed a Memorandum of Understanding with Bangladesh for the export of electricity from Jharkhand. The implementation agreement followed two years later, during Bangladesh Prime Minister Sheikh Hasina’s New Delhi visit in April 2017.
For years, the Opposition in Bangladesh alleged the agreement was signed under pressure from the Modi government. Now, with a regime change in Dhaka, the deal threatens to come undone.
A spokesperson of the Adani Group, however, said in response to Scroll’s queries: “We have no indication that the Bangladesh government is reviewing our PPA. In the spirit of partnership, we continue to supply power despite the substantial outstanding payments.”
The Adani spokesperson did not comment on the developments in Kenya, or the allegations by the Opposition in India that diplomacy by the Modi government was serving Adani’s business interests abroad.
Until 2014, when Modi became prime minister, the Adani Group’s projects outside India were limited to coal mining operations in Indonesia and Australia. Now, they span a wide range of infrastructure sectors across Asia and Africa.
In South Asia
Bangladesh is not the only South Asian country where controversies have dogged Adani projects.
In Sri Lanka, an official of the electricity board, deposing before a parliamentary committee, said that President Gotabaya Rajapaksa had told him in November 2021 that Modi was “pressuring him” to hand over a wind energy project to the Adani Group. This was days after Rajapaksa met Modi on the sidelines of the climate change conference in Glasgow. After the revelation caused an uproar in Sri Lanka, the official retracted his remarks and resigned from his position.
Earlier, in February 2020, Prime Minister Mahinda Rajapaksa had met Modi in Delhi and discussed “economically important matters”. Months later, media reports indicated that the Adani Group was a favourite to operate the East Container Terminal at the Colombo port as part of an agreement between India, Sri Lanka and Japan. After protests from unions and the Buddhist clergy, Sri Lanka reneged the agreement, but the Adani Group bagged the rights to operate another terminal at the port.
This year, the Adani Group has been in talks with Nepalese authorities to take over international airports in Nepal. Two new airports in Pokhara and Bhairahawa, built using loans from China, have so far remained economically unviable since India has not opened up high-altitude air routes for jet planes. Nepal’s prime minister raised the issue with Modi in a meeting in June 2023, following which officials of the Adani Group visited Kathmandu to hold discussions with Nepalese civil aviation authorities, according to the country’s finance minister.
From Tanzania to Vietnam
It isn’t just South Asia where Modi’s diplomacy has dovetailed with Adani’s expansion.
In March 2017, Modi hosted Malaysia’s Prime Minister Najib Tun Razak in New Delhi where the two discussed how to boost economic linkages between the two countries and the business prospects of Indian firms. A month later, the Adani Group signed an MoU with a Malaysian infrastructure conglomerate to develop a mega container port project on Carey Island.
In June 2018, Modi travelled to Singapore where he met Prime Minister Lee Hsien Loong. Later that month, Singapore’s state-owned investment firm Temasek invested Rs 1,000 crore in Adani ports.
Modi hosted the Tanzania’s President Samiha Suluhu in Delhi in October 2023. Eight months later, in May 2024, the Adani Group bagged a 30-year concession agreement to operate a container terminal at the Dar es Salaam port. It also entered into a joint venture with Abu Dhabi’s AD Ports group to acquire 95% stake in the company providing terminal services.
More recently, Vietnam’s Prime Minister Pham Minh Chinh came to Delhi in July-August 2024. The same day he met Modi, he also met Gautam Adani, announcing that the Adani Group was considering investing in two airports in Vietnam, close on the heels of its plans to build a seaport being approved.
The Adani Group has built significant business ties with Israel after Modi became the first Indian prime minister to visit Israel in July 2017. He hosted Israel’s Prime Minister Benjamin Netanyahu in Delhi in January 2018. In December that year, the Adani Group, in a joint venture with Israeli firm Elbit Systems, inaugurated a facility in Telangana to manufacture aerial military drones. In 2022, the Adani Group went on to acquire Haifa port in Israel.
‘Adani ji’s foreign policy’
Billionaire Gautam Adani, the chairman of the Adani Group, is known for his proximity to the Indian prime minister. Both men are from the state of Gujarat. Since 2014 when Modi became prime minister, the Adani Group has aggressively expanded and diversified its business, becoming the largest private owner of airports, seaports, coal mines, power stations, and gas stations in India.
This has invited accusations of crony capitalism, most notably from the Congress party, which sees the conglomerate’s global expansion in similar light. Speaking in Parliament in February 2023, Congress leader Rahul Gandhi said, “This is not India’s foreign policy. This is Adani ji’s foreign policy.”
Many observers view Adani’s global expansion through the geopolitical lens of India wanting to counter China’s growing influence in Asia and Africa, largely manifested through the infrastructure-focused Belt and Road Initiative. “Adani’s infrastructure empire fits with the Indian government’s economic agenda,” wrote Albert Vidal, an analyst at the International Institute for Strategic Studies, a think-tank headquartered in London.
But others have questioned the wisdom of the government putting its weight behind just one private player. India’s diplomacy “has to avoid tying itself, and by extension the national interest, in less than opaque ways to the fortunes of a single private entity”, journalist Nirupama Subramanian wrote in 2022.
These questions have become more acute after the Adani Group made global headlines last year for allegations of corporate fraud and money laundering levelled by American short-seller Hindenburg Research. Recently, Swiss authorities froze $311 million held by a Taiwanese resident suspected to have laundered money on behalf of the Adani Group – allegations that the group has denied.
As the Opposition in Kenya urged the government to abandon the airport deal with Adani, Jairam Ramesh, the communications chief of the Congress, warned that the protests in Kenya could “easily convert into anger against India and the Indian government” since Gautam Adani is seen as a friend of Modi.
source : scroll.in