The Economist: Modi To Suffer Politically From Adani Zapping

Adam Roberts of The Economist, who covered India for decades, says Indian Prime Minister Narendra Modi is known in his country as a very good pal of billionaire Gautam Adani as both men reached the pinnacles of their careers in Gujarat.

Photo Insert: Adani was one of a clutch of tycoons who backed Modi as he broke into national politics. One telling detail: Modi made heavy use of planes owned by Adani during his successful campaign to be prime minister in 2014.

Modi was the astute politician and Adani was the supportive crony who cut his teeth in business as Modi scaled the political ladder.

In his Feb. 5th newsletter, Roberts said he was in India when great gatherings of enraged protesters railed against the “seasons of scams” and the misdeeds of politicians and crony capitalists.

Among the worst was something known as “round-tripping,” a ruse in which funds were siphoned out of India, sent via front companies (often based in Mauritius) and brought back onshore. Public money vanished, and private individuals linked to politicians got very rich.

Modi explained to me his ideas for cleaning up India. He didn’t lead the anti-corruption protests at the time, but deftly benefited from them, Roberts wrote.

“So reading about the accusations of fraud against Gautam Adani’s companies offers a strange sense of déjà vu. It should be acknowledged that Adani, from whose enterprises $120 billion of value has been wiped, following allegations of fraud by an American research firm, denies any wrongdoing.

The Adani Group has also issued a lengthy rebuttal of the allegations. But like those scandals a decade ago, the Adani story is morphing from a financial tale to a political one,” he added.

Modi himself now risks entering the protesters’ crosshairs. He has long been close to Adani. Whatever the truth of the allegations, that association could become toxic given the public storm.

The two men worked in parallel in Gujarat: one as its chief minister, the other in a private business that forged ties to the state government as it won contracts to develop infrastructure and land.

Adani was one of a clutch of tycoons who backed Modi as he broke into national politics. One telling detail: Modi made heavy use of planes owned by Adani during his successful campaign to be prime minister in 2014.

The opposition has been blocked from debating the matter in parliament, so instead expect street demonstrations—something many urban Indians relish. Just possibly, the otherwise-split opposition and regional parties might be able to unite behind this case.

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