It’s been more than a week since the US Department of Justice, FBI and the Securities and Exchange Commission issued indictments- charging the Adani group, its top leadership including Gautam Adani of a conspiracy to bribe Indian government officials for contracts, and defrauding US investors by raising capital through bonds issues.

Remember these are indictments – they still need to go through a trial process, and only if there’s a conviction will the case itself go forward – there’s also the possibility of Adani paying fines and settling the case.

The Adani group has denied the charges – 5 counts in all naming various Adani group officials in India and the US and will take legal recourse. The links to these are below, and you can also see explainers at www.thehindu.com

Department of justice

US Securities and Exchange Commission

What is the impact of the Adani indictment on India-US ties?

To begin with, the Government’s response has been silence- with the explanation that this is a private company, and not connected with the government.

Remember, last year, the MEA had not responded to a series of allegations against the Adani group by US short-seller and market research company Hindenberg Research either. An Adani group official had alleged a conspiracy to defame India, even standing in front of the However, this time it is the FBI, the Department of Justice and the Securities and Exchange Commission making the allegations, which requires a response at a more official level.

Along with the FBI and DoJ’s investigation into the Pannun assassination plot case- the timing of the indictments into Adani appear to have political significance- given that the new Trump administration will come into place January 20th and will change most of the top prosecuting officials in both cases.

There is also the question of US double standards and overreach- given the indictment is for alleged bribes paid in India to Indian officials.

With warm personal ties with PM Modi and a planned visit by the US President to India for the Quad summit next year the government will likely not worry about the impact of other aspects of bilateral ties.

However, the company itself will not be able to raise funds in the US, nor will it have recourse to US government grants like the DFC loan for Colombo port in the foreseeable future, and this may impact India-US projects in the following areas:

Routing of funds for climate change transition from the US- given the Adani group’s dominance of solar power projects

Cooperation for High-Tech and Defence deals which may involve the group

Infrastructure projects in other countries where India, US are cooperating

What is the impact of the indictment on ties with other countries?

The first impact was seen in Kenya, where President Ruto cancelled contracts for an energy plant and airport project with the Adanis

In Sri Lanka the government announced it has a review by the ministry of Finance and Foreign Affairs looking into the Adani projects for a terminal at Colombo port, and wind energy. In responses to The Hindu, the US DFC said it is assessing the situation and hasn’t disbursed the $553 million project it promised a year ago.

In Bangladesh, after the courts ordered an enquiry, the government set up a panel to look into charges of overcharging and corruption into the Adani power agreement to supply power from a plant in Godda, Jharkhand.

In France, energy major Total said it was holding any further investment into an LNG venture with Adani.

Governments in countries like Tanzania where Adani is developing a container terminal, and Israel where Adani ports runs a terminal in Haifa port, have said they will continue with the projects however.

Remember Indian economic operations have already been affected by Geopolitics.

– Russia’s war in Ukraine has meant Sanctions against about 30 Indian companies

– Israel’s war in Gaza has affected IMEEC and I2U2

– Iran-US tensions have meant India lost a major supplier of oil due to sanctions. Also Venezuelan oil

– Sanctions on Myanmar have stopped infra projects

– Government Changes in Maldives Bangladesh and Sri Lanka have put Indian projects under the scanner

What does this mean for India’s investment diplomacy and image?

US charges will cause reputational damage when it comes to integrated and allied economy in North America and Europe.

Adani investments and projects have been closely aligned with Modi government’s foreign policy forays and priorities in infrastructure development and energy- both thermal and green power –- with projects in Nepal, Bhutan, Bangladesh, Sri Lanka, Myanmar, Kazakhstan and discussions with Indonesia, Vietnam and Greece, following shortly on high-level meetings with PM Modi- therefore it is harder to distance from the fallout of the US indictments.

If the trial proceeds in the US it puts a cloud over India’s own legal and regulatory mechanisms on dealing with corruption internally, and will raise questions about what steps the government is taking.

While these cases are about alleged corruption and coercion inside India, other states, especially where governments have changed may open enquiries into the nature of projects done by Indian companies with their predecessors.

WorldView Take:

For years, India’s foreign policy has been fuelled by its economic progress and the capacity of Indian companies to carry out international projects. It is futile to assume that charges brought against a major Indian company by a major global power will have no impact on India’s image or global economic policies. While there is no question, the US’s actions indicate a considerable overreach, they fall within American laws- and India cannot expect MNCs to operate according to Indian laws here, while not ensuring Indian companies do the same abroad.

Reading Recommendations:

 India’s Moment : Changing Power Equations around the World by Mohan Kumar
Gautam Adani: Reimagining Business in India and the World by R.N. Bhaskar

The End of the Chinese Century? How Xi Jinping Lost the Belt and Road Initiative by Bertil Lintner

The Great Tech Game: Shaping Geopolitics and the Destiny of Nations by Anirudh Suri

India’s Development Diplomacy: Understanding Development Cooperation As A Tool For Strategic Engagement In South Asia by Urmi Tat

India’s Trade Policy: Arvind Panagariya

Presentation and script: Suhasini Haidar

Editing: Kanishkaa Balachandran, Sabika Syed

Filipino journalist Maria Ressa, 2021 Nobel Peace Prize winner and Rappler CEO gestures as she talks to reporters after being acquitted by the Pasig Regional Trial Court over a tax evasion case in Pasig City, Philippines, on Sept. 12, 2023.
| Photo Credit: AP

A court has ruled that the Philippine news site Rappler can continue operating, according to a copy of the decision released to the media on Friday (August 9, 2024), in the latest legal victory for the media outfit.

The Court of Appeals overturned a previous ruling by the Philippine Securities and Exchange Commission (SEC) that had effectively ordered the shutdown of the company co-founded by Nobel laureate Maria Ressa.

Ms. Ressa, who was awarded the Nobel Peace Prize in 2021, was a vocal critic of former President Rodrigo Duterte and the deadly drug war he launched in 2016.

That triggered what media advocates say was a grinding series of criminal charges, probes and online attacks against her and Rappler.

The Court of Appeals issued its ruling on July 23 that “reversed and set aside” the SEC decision on the grounds that its order had been a “grave abuse of discretion”.

It contravened “established procedures, jurisprudential and legal instructions, and clear intent of the Constitution”, the court said.

The SEC shutdown order was issued on June 29, 2022, the day before Mr. Duterte left office.

A logo is pictured on the facility of flat-rolled aluminium producer Novelis, part of Aditya Birla Group.
| Photo Credit: REUTERS

 Novelis Inc., a sustainable aluminium solutions provider and the world leader in aluminium rolling and recycling, has announced that it has filed a registration statement with the Securities and Exchange Commission relating to the proposed initial public offering of its common shares.

 The common shares are expected to be offered by Novelis’ sole shareholde Hindalco Industries Lid of the Aditya Birla Group. 

Novelis will not receive any proceeds from the sale of common shares by its sole shareholder, the company said in statement. 

Novelis intends to list its common shares on the New York Stock Exchange under the ticker symbol “NVL.”

The number of shares to be offered and the price range for the proposed offering have not yet been determined. 

The company is expected to complete the public offering after the SEC completes its review process, subject to market and other conditions. 

“There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering,” it said in the statement.

Wilmington:

Elon Musk, the world’s richest man, is under investigation by the U.S. Securities and Exchange Commission over his $44 billion takeover of social media giant Twitter, according to a Thursday court filing in which the agency sought to compel Musk to testify.

The investigation — which escalates a long-running feud between the SEC and Musk — concerns whether Musk broke federal securities laws in 2022 when he bought stock in Twitter, which Musk renamed X, as well as statements and SEC filings he made in relation to the deal.

The SEC said it subpoenaed Musk in May 2023 requiring him to provide testimony at the SEC’s San Francisco office, and that Musk had agreed to appear on Sept. 15. But then two days beforehand Musk raised “several spurious objections” and told the SEC he would not appear, the SEC said. Musk also refused to SEC proposals to conduct the deposition in Texas in October or November.

Among his objections was that the SEC was trying to “harass” him and that his counsel needed time to review potentially relevant material contained in a biography of Musk published last month, the SEC said.

According to the filing, Musk has given the SEC documents relating to the probe and has previously provided testimony in July last year via video conference.

“The SEC has already taken Mr. Musk’s testimony multiple times in this misguided investigation – enough is enough,” said a statement from Alex Spiro, an attorney for Musk.

In a press release, the SEC said it was seeking “Musk’s testimony to obtain information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.” An SEC spokesperson declined to comment further.

Musk acquired Twitter after initially building a large minority stake in the social media platform, which he first disclosed in April 2022. Musk was late with the disclosure filing and initially indicated that he planned to be a passive stakeholder, meaning he did not plan to take over Twitter or influence its management decisions.

Days later, Musk accepted and then turned down a board seat at Twitter. In late April, he announced plans to buy the company for $44 billion but subsequently tried to get out of the deal, alleging Twitter was not disclosing the full extent of bot activity on its platform.

Faced with a trial that sought to compel him to complete the deal, Musk closed his acquisition of Twitter in late October 2022.

Musk-SEC Feud

Thursday’s filing is the latest brushup between Musk and the SEC which have been feuding since Musk’s 2018 tweet that he planned to take his electric carmaker Tesla private and had funding secured. Since then, Musk has repeatedly denigrated the SEC, which has opened multiple probes into Musk over the years.

“A comprehensive overhaul of these agencies is sorely needed, along with a commission to take punitive action against those individuals who have abused their regulatory power for personal and political gains,” Musk said in a post on X.

Howard Fischer, a partner at law firm Moses & Singer and former SEC official, said Musk’s refusal to appear at the September testimony was extraordinary. “I have never heard of a senior executive who has positions at public companies ever not showing up.”

Thursday’s lawsuit adds to Musk’s legal woes. Reuters previously reported the Justice Department is investigating Tesla over self-driving claims. Federal prosecutors in New York have also opened an investigation related to Musk’s corporate perks and claims related to vehicle driving range, a source with knowledge of the probe said.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)