An art school teacher puts the crisis surrounding Gautam Adani on paper in his own way.
Photo: AFP/Indranil Mukherjee
Not all passengers in India are aware of this, and foreigners even less so: Anyone who lands or takes off at Mumbai Airport uses a facility that belongs to Gautam Adani’s group. The same applies to the airports in Lucknow, Guwahati, Jaipur and Ahmedabad. Two years ago, the Ministry of Aviation sold the operation of eight major airports in the country, seven of which went to a subsidiary of the Adani Group. The 60-year-old businessman, already known as the king of coal, became the largest airport operator in India in 2021. He also owns Navi Mumbai Airport, which is currently under construction and is also located in the economic metropolis.
Far better known are his activities in the field of coal mining. In 2007, a subsidiary in this division started on the domestic energy market. Adani Mining is now not only present there and in Indonesia, but also in Australia. In northeast Down Under, the Adani Group began production in 2021 from the controversial Carmichael mine, which has faced fierce opposition from environmental groups for years. Because the transport routes from the next port lead by cargo ship right through the highly sensitive ecosystem of the Great Barrier Reef World Heritage Site. Any small accident there could have catastrophic consequences. The group is also active in the areas of cement, gas, media, data processing, plastics and ports/logistics. At the peak of the worst Indian corona wave in May 2021, the group of companies took over the transport of oxygen supplies for ventilation nationwide on a large scale.
Adani’s personal wealth was $150 billion at its peak last September, and was still $119 billion on January 24. He was recently the third richest man in the world and number one in Asia. Within just a week, its assets alone have now halved to around $64 billion, while the Adani Group’s overall valuation on the stock market has lost close to $110 billion over the same period, a good quarter of its previous value and equivalent to the gross domestic product of Kenya or Ethiopia. The business magazine Business Today wrote about a financial “bloodbath” in an article.
Adani Enterprises, something of the family’s flagship, was about to issue $2.5 billion worth of new shares in what would have been India’s largest IPO. On February 1, Adani announced that the plans would be abandoned for the time being.
A report by the US investment company Hindenburg Research triggered the fall in prices, which accounts for 10 to 60 percent of the companies in the group. She accuses the management of the Adani Group of deception, accounting fraud and market manipulation. Adani put money into his own shares through his brother’s accounts in tax havens, artificially inflating their price.
The focus of the alleged financial scandal are loans in the equivalent of 30 billion dollars. According to media reports, these liabilities made the Adani Group one of the most indebted corporations in India. At least core investors like a large fund from the United Arab Emirates are still sticking with Adani. The top management sharply rejected the allegations. And Hindenburg speculates on falling stock prices. Nevertheless, the Indian Securities and Exchange Commission has started investigations.
Gautam Adani, who left school early at the age of 16 and later only lasted two years in a business course at the university, apparently inherited business talent from his parents, who ran a textile business. First he cut diamonds, then he traded in gemstones, with which he laid the foundation of his current fortune in the 1980s. Later he expanded his activities to more and more business areas. Unlike other self-made billionaires in India, however, Adani rarely boasts about his immense wealth and tends to shy away from the limelight. He rarely appears in public.
However, his close ties to Hindu nationalist Prime Minister Narendra Modi are no secret. Both come from the western union state of Gujarat. In a recent interview with the television station NDTV, Adani defended himself by pointing out that he had already advanced his company significantly in 1985 and after the great wave of liberalization in 1991, when the opposition Congress Party was still in power today. Nevertheless, the activities and value of the companies once again increased considerably when Modi was chief minister of Gujarat for twelve years and has governed all of India since 2014. Opposition representatives are also calling for a special commission chaired by high-ranking judges.