The Adani Group, led by billionaire Gautam Adani, is under intense scrutiny following a U.S. indictment alleging a $265 million bribery scheme to secure lucrative contracts. The indictment has triggered concerns among global banks, with some reportedly pausing fresh credit to the conglomerate while maintaining existing loans. Ratings agency S&P warned that the group’s ambitious growth plans rely heavily on continued access to equity and debt markets, which may now face significant challenges. Despite assurances of no immediate debt crises, Adani’s financial standing is increasingly precarious.
The allegations center around Adani Green Energy, accused of bribing Indian officials to secure solar energy projects expected to generate $2 billion in profit over two decades. U.S. authorities also claim misleading public disclosures, despite the group's awareness of the investigation since 2023. Adani has denied the accusations, calling them baseless, and vowed to pursue all legal remedies. However, the fallout has already been severe, with the company’s bonds and stock prices plummeting, erasing nearly $28 billion in market value over two days.
The impact extends beyond the Adani Group, potentially slowing investment in India's renewable energy sector, a critical component of global climate initiatives. Analysts warn that international investors may now demand stricter transparency and due diligence, affecting project financing timelines. This development casts a shadow over India’s ambitious clean energy goals, which rely heavily on foreign investment and public-private partnerships.
Further compounding the group’s troubles, Kenya recently canceled two major infrastructure deals worth nearly $3 billion, including a power transmission project and an airport control contract widely expected to go to Adani. Additionally, Adani Green withdrew a planned $600 million U.S. bond sale amid the allegations. The group’s dollar-denominated bonds also suffered steep declines, with longer-dated securities trading below 80 cents on the dollar.
Indian regulators are conducting preliminary checks into whether Adani entities violated local market rules, even as earlier investigations remain unresolved. Meanwhile, U.S. prosecutors accuse Gautam Adani and other executives of orchestrating the bribery scheme, leaving the company in disarray. Adani’s absence from public view has fueled speculation about his whereabouts, as the controversy continues to unravel the group’s global ambitions.
