Indian billionaire Gautam Adani, one of the world’s wealthiest individuals, finds himself at the center of a sprawling corruption scandal. U.S. federal authorities have unsealed criminal and civil charges against Adani and several associates, accusing them of orchestrating a multi-million-dollar bribery scheme to secure the success of a massive solar energy deal in India.
The case has sent shockwaves through global markets, leading to a precipitous drop in the value of Adani Group companies and raising questions about corporate governance and transparency in one of the world’s fastest-growing economies.
Solar Bid That Sparked the Scandal
The controversy dates back to June 2020, when Adani Green Energy, a subsidiary of the Adani Group, won a landmark contract to supply 8 gigawatts (GW) of solar energy to the state-owned Solar Energy Corporation of India (SECI). The bid, celebrated as the largest solar development agreement ever awarded, positioned Adani Green Energy as a key player in India’s renewable energy ambitions.
However, this ambitious project encountered an unexpected roadblock: state-level power distribution companies (discoms) expressed reluctance to purchase the solar energy at the agreed rates. Discoms were reportedly betting on future declines in renewable energy costs and hesitated to commit to the higher prices offered by SECI. This resistance threatened to derail the deal, potentially costing Adani Green Energy billions of dollars in future revenues.
Allegations of Bribery and Corruption
Faced with this impasse, Adani allegedly resorted to illegal measures. According to indictments and complaints from the U.S. Department of Justice (DOJ) and the Securities and Exchange Commission (SEC), Adani and his associates orchestrated a bribery scheme to persuade state officials to agree to the contracts. The DOJ indictment details promises of hundreds of millions of dollars in bribes to key officials, particularly in the southern state of Andhra Pradesh.
Alleged Scheme
- November 2020: SEC filings and encrypted WhatsApp messages suggest that Adani’s nephew, Sagar Adani, and Azure Power Global’s then-CEO, Ranjit Gupta, discussed incentives for state officials to sign the power purchase agreements. Messages referred to the difficulty of maintaining appearances while offering “doubled incentives.”
- August 2021: Gautam Adani reportedly began direct negotiations with an Andhra Pradesh official, ultimately offering $228 million in bribes. By December of that year, Andhra Pradesh had agreed to buy the solar power, and other states soon followed, with additional bribes allegedly promised.
- December 2021: Adani Green Energy’s sudden success raised eyebrows in the marketplace, prompting speculation about the deals’ integrity. At the time, Adani proclaimed the company was on track to become the world’s largest renewable energy provider by 2030.
U.S. Authorities Investigate
The scheme’s unraveling began in March 2022, when the SEC sent a general inquiry to Azure Power Global, which was listed on the New York Stock Exchange. The inquiry sought information about recent contracts and whether foreign officials had requested anything of value.
According to U.S. prosecutors, Gautam Adani responded by attempting to conceal the bribes. During a meeting in April 2022, he allegedly told Azure representatives that he expected reimbursement for over $80 million in bribes. In an attempt to cover up the payments, Azure executives and a leading investor in the company reportedly arranged for Adani to take over a profitable project, masking their role in the scheme.
Fraudulent Fundraising and False Statements
Despite growing scrutiny, Adani Group continued to raise billions of dollars from U.S. and international investors through loans and bond offerings. Prosecutors allege that the company provided false assurances in fundraising documents, claiming adherence to anti-bribery laws while concealing the illegal payments. Four major fundraising transactions between 2021 and 2024 are now under investigation.
Fundraising Developments
- March 2024: Adani Green Energy sold secured notes to investors while allegedly continuing to conceal the bribery scheme.
- December 2023: The company secured a $1.36 billion syndicated loan agreement under similarly false pretenses.
Criminal Charges and Market Fallout
On October 24, 2024, a Brooklyn grand jury secretly indicted Gautam Adani, Sagar Adani, Ranjit Gupta, and five other associates. When the indictment was unsealed on November 20, it triggered a dramatic market reaction. Adani Group companies lost $27 billion in market value in a single day, and Adani Green Energy canceled a planned $600 million bond sale.
The charges include conspiracy to violate the Foreign Corrupt Practices Act (FCPA) and securities fraud. If convicted, Adani and his co-defendants could face significant penalties, including hefty fines and imprisonment.
Adani Group’s Denial
The Adani Group has strongly denied the allegations, calling the charges “baseless” and vowing to explore all legal avenues to defend itself. In a statement, the conglomerate emphasized its commitment to ethical business practices and described the U.S. government’s actions as an “overreach.”
India’s Energy Sector
The case has broader implications for India’s renewable energy ambitions. As one of the world’s largest and fastest-growing economies, India is a key player in the global push for clean energy. The allegations against Adani, a dominant force in India’s infrastructure and energy sectors, risk undermining confidence in the country’s corporate governance.
Additionally, the case highlights potential vulnerabilities in India’s regulatory framework, where state-level corruption can disrupt national initiatives. Industry experts warn that the scandal could deter foreign investment in Indian renewable energy projects.
U.S. Jurisdiction
The U.S. government’s involvement in the case stems from the Adani Group’s fundraising activities in American financial markets. By raising capital from U.S.-based investors and allegedly providing false statements, the company came under the jurisdiction of U.S. securities and anti-corruption laws.
This case underscores the global nature of corporate governance and the growing reach of the FCPA, which aims to combat bribery of foreign officials by companies operating in international markets.
What’s Next?
As Adani remains in India and out of U.S. custody, the path forward for prosecutors remains unclear. Extradition could prove challenging, given the complexity of India-U.S. diplomatic relations and Adani’s high-profile status.
Meanwhile, the SEC and DOJ are likely to continue their investigations, focusing on other potential violations by Adani Group companies. The scandal also raises questions about the role of Azure Power Global, which has cooperated with U.S. authorities but may face additional scrutiny for its involvement in the scheme.
