THE POLITICAL BLOWBACK
The PM looks to deflect Rahul Gandhi’s allegations of a ‘Modi-Adani’ nexus, invoking the “blessings of 1.4 billion people”. How will this play out for the leaders and their parties?
SOME PEOPLE ARE LIVING FOR THEMSELVES AND THEIR FAMILIES, BUT MODI IS LIVING FOR THE PEOPLE OF INDIA. SOME PEOPLE ARE DESTROYING INDIA FOR THEIR FAMILIES
NARENDRA MODI Prime Minister of India
On February 7, as Congress leader Rahul Gandhi made his explosive allegations against Prime Minister Narendra Modi in the Lok Sabha, accusing him of unduly favouring billionaire industrialist Gautam Adani at the cost of the country, he charged that “the real magic” started in 2014 after the BJP came to power in New Delhi. The list of accusations was long, with Rahul buttressing the charges by holding up pictures of the PM and Adani together in the latter’s private jet. The scathing attack on the PM went viral on social media, and Speaker Om Birla later expunged 18 remarks Rahul made against Modi and Adani, leading to a Congress leader tweeting on how “Democracy was cremated in the Lok Sabha”.
In his reply the next day, PM Modi niftily turned around the debate to a personal attack on himself, invoking the “trust of 1.4 billion Indians” that acted as a “protective shield that no lies could pierce”. Taking the attack to the Congress, he countered Rahul, saying a party “drowning in despair and hubris” was bent on seeing everything in a bad light.
The PM’s 87-minute speech, though, made no mention of the man at the centre of the storm, Adani. The industrialist’s phenomenal rise, particularly in the past decade, has often raised allegations of crony capitalism by the Opposition who point out that the industrialist’s worth has risen by more than 200 per cent since Modi became PM (from No. 609 to No. 2 in the rich list, according to Rahul’s calculations). Much of this is credited to Modi’s business-friendly policies, first as Gujarat chief minister and then as prime minister, which saw Adani win
ning several government tenders and infrastructure projects in ports, airports, roads, rail, fossil fuels and green energy across the country. In 2018, a controversial decision by the Modi government—not making prior experience a requisite and ignoring red flags by the finance ministry and NITI Aayog—allowed Adani to bid and win tenders for six airports. Adani had no prior experience operating airports, but the decision turned his group into one of the country’s biggest private airport operators overnight.
The documents available suggest that the PPP division of NITI Aayog had reservations that the bidder lacked technical capacity and could jeopardise the project. However, an empowered group of secretaries had already decided to not make prior experience a prerequisite. “There was a strong argument that it will enlarge the competition,” says a bureaucrat privy to the discussions. He added that other than Adani, GMR Group, Zurich Airport, Cochin International Airport and Changi Airport (Singapore) had participated in the bids. There were arguments from the department of economic
IF THE PM IS NOT A FRIEND (OF ADANI), THEN HE SHOULD HAVE AGREED TO AN INQUIRY. THERE WAS NO PROBE INTO SHELL FIRMS IN THE DEFENCE CONTRACTS...
RAHUL GANDHI Congress leader, MP
FOR RAHUL, THE CHARGES ARE A VINDICATION OF HIS FREQUENT CLAIM THAT THE MODI GOVT HAS BEEN UNFAIRLY BACKING TWO TOP BUSINESS EMPIRES
affairs (DEA) to restrict corporate houses to two airports each, especially since the airports going under the hammer required massive capital. But in 2018, when the discussions were happening, many of the domestic infrastructure players were nursing bleeding balance sheets. Congress leaders had even then raised red flags but the BJP leaders argue that decisions were taken keeping in mind ease of doing business guarantees for the serious players.
On the Adani Group’s foray into the defence sector, Rahul alleged that the whole India-Israel defence collaboration initiative had been handed over to Adani on a platter, with all bilateral manufacturing contracts going to the group. Again, this is happening when the Adanis have zero prior exposure in the sector. Military observers, though, feel the allegations are just part of a ‘political slugfest’. On the issue of prior experience, they say no private Indian concern would meet those qualification parameters in what was hitherto a public sector monopoly. What they can do is tie up with a foreign entity and collectively gain experience, which readies them for the pre-qualification stage. “Here, the only question is whether any pre-qualification criteria were relaxed [for the Adanis] or not,” says a defence expert. Apart from the missile agreement with Bharat Electronics Limited (BEL), an Indian governmentowned aerospace and defence electronics company, Adani and their partner Israeli firms got the drone, radar and communication systems contracts.
A key official at the Ministry of Defence (MoD) points to the Tata Group’s entry into aircraft manufacturing. “The Tatas had never made aircraft, but they have tied up with Airbus and are now making C295 transport planes here in India. Similarly, L&T has been roped into the nuclear submarine programme. They too had no previous experience,” says the official, adding that the only thing that matters is the financial and technical capability of the company to carry out the contract.
Meanwhile, Adani’s reaction to the recent developments has been to invoke nationalism and even call the Hindenburg report an attack on India itself. The grandstanding, though, has failed to impress the Opposition as both houses of Parliament witnessed several adjournments amid protests and sloganeering. In a fiery intervention in the Lok Sabha, Trinamool Congress MP Mahua Moitra denounced the government for favouring Adani, saying, “The pride of India is not the wealth of one individual, the pride of India lies in
the robustness of its institutional structures.” Pointing to the treasury benches, she added, “Don’t let him smear your time in government with the stink of crony capitalism. Please immediately order a full, complete and thorough investigation into all matters.. .our country’s reputation is at risk.” The Congress and 16 other Opposition parties have demanded a joint parliamentary committee (JPC) or a Supreme Court-monitored probe into the Adani Group. “Only a JPC or an SC-monitored investigation under the CJI can bring out the truth about the ‘forced’ investments by LIC and PSU banks in companies accused of financial fraud, endangering the hard-earned savings of crores of Indians,” stressed Congress president Mallikarjun Kharge.
While leaders in the Rajya Sabha have moved a notice under Rule 267, several Lok Sabha members have moved a similar notice to discuss the issue in the lower house. LS Speaker Birla has denied the requests, asking members “not to make unsubstantiated claims”, while Rajya Sabha chairperson and vice-president Jagdeep Dhankhar rejected all motions saying they were “not in order”. But the Opposition is adamant.
HUM ADANI KE HAIN KAUN?
The Opposition’s attacks continue on different fronts. Playing on a popular romcom title from the 1990s, the Congress has been asking the central government , ‘Hum Adani ke hain kaun? (Who are we to Adani?)’, a corollary to which has been three questions posed every day to PM Modi since February 5 on the issue. Congress members have also been protesting in front of the offices and branches of LIC and SBI across India. Via stock investments (LIC) and loans (SBI), both A-list public sector institutions have skin in the Adani game, though both say their exposures are less than 1 per cent of their total investments.
There is a feeling in the Opposition that the Adani controversy could mirror the 2011 moment, when the BJP cornered the Congress-led UPA government over allegations of scams in the allocation of telecom spectrum, coal blocks and infrastructure projects. The last such attempt to target the BJP government was in the run-up to the 2019 general election, when Rahul raised allegations of corruption in the Rafale fighter jets deal. That didn’t get much traction then, and it was later even held to be counter-productive to go after Modi directly. The Congress leader will be hoping for an impact more on the lines of his 2015 “suit boot ki sarkar” jibe on Modi. That had forced the government to let the controversial land acquisition ordinance—introduced to make amendments to the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (RFCTLARR) Act, 2013—lapse.
Indeed, for Rahul, the charges have come as a vindication of his frequent claim that the Modi government has been unfairly backing two top industrialists. “For a number of years, I have been talking about the government and ‘Hum do, hamare do’. The government does not want…
indeed it is scared of a discussion in Parliament on Adani,” he told reporters after his LS speech. He further took a dig at the Modi government saying the much talked about “Amrit Kaal” is actually a “Mitr (friend) Kaal”.
For now, the Opposition seems united against Modi, but several undercurrents are visible. The Congress seems to have the support of anti-BJP parties on the Adani issue, but regional heavyweights such as the Bharat Rashtra Samithi (BRS), Aam Aadmi Party (AAP) and Trinamool Congress (TMC) are reluctant to come under a Congress umbrella, preferring to lead their own battles. For instance, when the Congress called a meeting to discuss Opposition strategy in Parliament, Mamata Banerjee’s TMC skipped it. And while the Congress and other parties decided to take part in parliamentary proceedings from February 8, AAP and BRS stayed away as a JPC has not been ordered.
PLAYING ON THE FRONT FOOT
For someone who has been extremely vocal about bringing economic offenders to book, PM Modi has so far avoided talking about the Adani allegations directly. Indeed, the PM’s gameplan from the beginning was to make the case that Rahul’s charges were aimed at him personally, questioning his commitment to the people, his integrity, the schemes that he had launched, and the general “positivity” he had brought about in the country. Taking a dig at Rahul’s comment that Harvard University might do a case study on the “Adani scam”, the PM said that the American university has already done a study titled ‘In the Name of Democracy? The Rise and Decline of India’s Congress Party’. Without directly referring to Rahul’s allegation that he had coerced the governments in Bangladesh and Sri Lanka to give contracts to the Adani Group, PM Modi said: “The Opposition leaders contradict their own statements. They say India’s global image has weakened since 2014. But they also say that India bullies foreign governments. They must make up their mind….”
Like the PM, other senior BJP leaders have also skirted direct allusions to a Modi-Adani connection. Finance minister Nirmala Sitharaman dismissed concerns that the controversy will alarm global investors, saying India’s financial markets are “very well regulated”. Parliamentary affairs minister Prahlad Joshi maintained that there was no connection between the Adani affair and the government. BJP MP Nishikant Dubey was the only one to take the bull by the horns: “If you can prove that after becoming PM, Modiji travelled even once with Adani, I’ll resign.”
For BJP’s ideological fountainhead Rashtriya Swayamsevak Sangh and many of its affiliates, Adani has been a poster boy of the self-made, desi entrepreneur who made it big on the global circuit. The RSS-linked Organiser magazine sees the Hindenburg report and subsequent reactions by some global institutions as an attack on the Indian economy and part of a series of events that have “eventually benefitted China”. It cited how not only Adani, but other groups such as the Mukesh Ambani-led Reliance Industries and Anil Agarwal-led Vedanta Resources have had to undergo such attacks. ‘These instances only prove that assaults on the Indian economy have now become very easy in an open and interconnected world. This is part of the fifth-generation warfare wherein hostile powers use various oblique tactics to target the Indian economy,’ said one of its reports. It also pinned the blame on an ‘Indian lobby which includes the country’s famous propaganda websites associated with Leftist ideology’.
RSS affiliate Swadeshi Jagran Manch (SJM) has offered no direct defence of the Adani Group, but questioned the intent of Hindenburg Research. “What is their interest? In the US, there have been several instances where the courts have taken previous such reports by Hindenburg with a pinch of salt,” says SJM convenor Ashwani Mahajan. In fact, most BJP leaders insist the report is part of a global conspiracy against Modi and India which, in their eyes, also includes the recent BBC documentary on the 2002 Gujarat riots that took place when he was the state’s chief minister. “If that was a political attack, Hindenburg is targeted at India’s economic resurgence,” says a BJP minister.
Meanwhile, pro-BJP social media handles have openly come out in support of Adani. Social media platforms have been flooded with memes questioning the Hindenburg report. #IndiaStandsWithAdani has been among the top-trending hashtags on Twitter. Even some celebrities have joined this narrative, including godman Sadhguru and former cricketer Virender Sehwag. “The hitjob on India’s markets looks like a well-planned conspiracy,” tweeted Sehwag.
While the BJP may be successful in managing public perceptions, Adani’s fall, if it happens, may impact the prime minister’s image. Especially so if the RBI and market watchdog SEBI were found to be lax in monitoring Adani’s investments and irregularities surface.
If the big-ticket infra projects sanctioned by the government to the Adani Group come to a halt, it will be a challenge for the prime minister to convince the nation about his government’s intent in reposing faith in the business group. With just a year left to the next general election, any such mishap will put Modi on the back foot while giving the Opposition some much-required ammunition. “The allegations in the Rafale scam did not impact the common voters. Nobody could understand the scope of the scam. But in the case of the Adani scam, if the company goes bust, it will impact millions of Indians. Modi will have no escape route then,” says a Congress Rajya Sabha MP. That may be taking things a tad too far, but there’s no doubt that all parties concerned in the controversy will not come out looking too rosy. ■
ADANI’S FALL, IF IT HAPPENS, MAY IMPACT THE PM’S IMAGE, ESPECIALLY IF THE RBI AND SEBI ARE FOUND TO HAVE BEEN LAX IN MONITORING THE INVESTMENTS OF THE GROUP