The Adani case: What happens next

America's Department of Justice and the Securities and Exchange Commission have indicted Gautam Adani, his nephew Sagar Adani, and six others, alleging their involvement in paying $250 million in bribes to Indian officials and concealing the scheme from US investors.

- AMIT TANDON

The allegations have been denied, citing a lack of evidence that the bribes were paid.

This comes within two years of allegations by Hindenburg, a New York-based short-seller. In January 2023, Hindenburg accused the Adani Group of stock manipulation and accounting fraud, claiming the group inflated its market value by using offshore funds. The Securities and Exchange Board of India (Sebi) investigated the group's transactions but has not found or reported any evidence of wrongdoing. However, Sebi turned the tables on Hindenburg, telling them that the short-seller itself was being investigated for trading on non-public information from its own report.

In March 2023, the Supreme Court set up a committee under Justice A M Sapre to investigate potential regulatory failures after investors incurred significant losses due to market volatility following these allegations. While the committee did not give a clean chit to Adani on many aspects of the probe, it stated that there is no evidence "as of now" against the conglomerate. Additionally, the committee found no regulatory failure on Sebi's part in its investigation into the Adani companies.

If anything, Hindenburg's allegations were more serious, though the current allegations come from a more credible source and may have some consequences. But regardless of the facts—and the eventual outcome—the allegations strike at the heart of doing business in India.