We have updated our Privacy Policy and Terms of Use for Eurasia Group and its affiliates, including GZERO Media, to clarify the types of data we collect, how we collect it, how we use data and with whom we share data. By using our website you consent to our Terms and Conditions and Privacy Policy, including the transfer of your personal data to the United States from your country of residence, and our use of cookies described in our Cookie Policy.
{{ subpage.title }}
Destroyed buildings in the aftermath of the deadly earthquake, in Antakya, Turkey February 19, 2023.
Hard Numbers: Turkey/Syria quake death toll, Modi ally’s biz empire crumbles, West Bank violence, AMLO believes in elves
50,000: The death toll of the Feb. 6 Turkey/Syria earthquakes topped 50,000 on Sunday. Turkish President Recep Tayyip Erdoğan is feeling the heat over allegedly corrupt practices that led to so many collapsed buildings on his watch ahead of the May 14 election.
145 billion: The industrial empire of Indian billionaire Gautam Adani lost $145 billion — 60% of its value — in the month following allegations of fraud by Hindenburg Research, a US-based short seller, which Adani virulently denies. The Adani Group has faced years of corruption allegations, but it remains to be seen if the longtime ally of PM Narendra Modi is too big to fail.
2/1: Violence ensued in the West Bank on Sunday after a Palestinian gunman killed two Israeli settlers. That sparked a retaliatory rampage by settlers on the village of Hawara that killed at least one Palestinian, bringing the West Bank to boiling point.
7 million: Did someone leave the wardrobe open?! Mexico’s President Andrés Manuel López Obrador, known as AMLO, tweeted a photo of what he claims is an “aluxe”, a mischievous woodland spirit from Mayan folklore requiring gifts to appease it. The tweet had 7 million views as of Monday morning and is not out of character for AMLO, who has long revered indigenous beliefs and culture.Indian billionaire Gautam Adani.
As Asia’s richest man falters, will his ties to Modi hurt the PM?
For years, India’s Adani Group, an Indian conglomerate and the world’s largest private developer of coal plants, faced repeated allegations of corruption, money laundering, and theft of taxpayer funds. Those claims tended to be of local origin, and they triggered low-level investigations that usually went away. Meanwhile, Gautam Adani, 60, continued to amass his wealth, becoming critical to India’s infrastructural expansion under powerful Prime Minister Narendra Modi. Known as “Modi’s Rockefeller,” Adani is now Asia’s wealthiest man.
US probe leads to scandal. Now, Adani’s family-run energy and transport empire has been slammed with a US-based investigation by Hindenburg Research. The New York-based financial forensics investigator has cited evidence of suspected money laundering, stock manipulation, and tax fraud, causing Adani Group’s market value to tumble. Crucially, the report also raises questions about Adani’s proximity to his friend and ally, Modi.
Starting off with diamonds and commodities, Adani is now the coal king of India. Despite protests and regulations against the use of dirty fossil fuel, the first-generation entrepreneur has also expanded into defense, media, and cement, but much of his money has come from energy and infrastructure contracts, many of them tendered during the Modi era. While the relationship between the two men has been under scrutiny for years, the widely cited Hindenburg investigation doesn’t just detail the extent of Adani’s misdoings, but it also claims he couldn’t have gotten so far without the government stonewalling regulators and supporting his expansion.
Modi’s been silent about his ties to Adani, but he has reportedly nurtured a connection with him since the 1990s. Before Modi was PM, he was the chief minister of Gujarat, the same state where Adani got his start and where one of Modi’s major gifts to him was land at a throwaway price, which essentially became the launchpad for Adani’s biggest power moves.
The fallout. The scandal has triggered a run on Adani’s companies, clouding prospects for India’s excellent emerging market potential, but their immense size and role in India’s recent growth spurt still have analysts convinced that Adani is too unique to fail.
With elections due next year, the bigger question is whether it will hurt Modi’s prospects for a third term. The Hindenburg findings prompted India’s divided opposition to demand an investigation into how regulators let Adani get this far. Many analysts claim that he and Modi have scratched each other’s backs for over two decades, noting that Adani was worth a mere $2.8 billion in 2014, when Modi became PM, and that he’s now worth $119 billion.
Still, analysts are doubtful the PM will be hurt by the fallout.
“I don’t expect these revelations about the Adani Group to harm Modi politically,” says Michael Kugelman, the director of the South Asia Institute at the Wilson Center in Washington. “He remains remarkably popular and can easily withstand the types of challenges that would doom more vulnerable politicians.”
Teflon Modi. Modi’s popularity is amongst the highest in the world. Despite recent and not-so-recent failures – from bungling India’s COVID response to not reigning in anti-Muslim policies of his Bharatiya Janata Party – Modi seems to be India’s Teflon Man.
“One reason why Modi doesn’t suffer politically from these episodes is that these challenges can be depicted as a reflection of his victimhood,” says Kugelman, referring to Modi’s often-used “they’re gunning for us” brand of Hindutva politics. Modi alleges that “powerful forces are unfairly conspiring to impugn and weaken him, and that can’t stand," he says.
Last week, Adani’s spokespersons took a similar nationalist approach against his American naysayers, claiming that an attack on the group was an attack on India. But while Adani is threatening legal action against the US-based investigators, Modi might not need to go on the defensive just yet.
“India lacks a strong and united opposition with the capacity to exploit these moments, and the main opposition group remains quite weak,” says Kugelman.
For now, Modi is popular enough at home that he doesn’t need to worry too much about the hits to his image.
“The Adani scandal will come and go like the others before it and will have little lasting political impact on Modi,” says Kugelman, noting that the PM can “easily withstand these political shocks.”