(Bloomberg) — Almost a week after bombshell allegations by the US of Gautam Adani’s involvement in a bribery plot, an outpouring of public backing for the Indian billionaire slowly began to build.
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The groundswell began early Wednesday, when an Adani Group unit issued a filing asserting that initial reports on the indictment were inaccurate — the company’s main defense was that its executives were being charged only with fraud, not bribery.
Later that morning, two former public officials within a half hour of each other held separate press conferences. Though they said they were speaking for themselves, their main message was the same: No Adani officials had been charged with bribery.
“I do not find a single name, single detail in the charge sheet as to who has been bribed,” said Mukul Rohatgi, a lawyer and former attorney general who has done work for the conglomerate in the past. He later told Bloomberg News the company had asked him to share his views publicly but the views were his own.
On social media, meanwhile, the hashtag #AdaniNotGuilty went viral, as an outburst of support for the infrastructure conglomerate — widely seen as a national champion with close links to Indian Prime Minister Narendra Modi — emerged. Pro-government media personalities called it an attack by the US “deep state” on India, adopting language used by those who claim President-elect Donald Trump is a victim of US law enforcement overreach.
The sudden surge in public support for the tycoon and his empire suggests a broader effort by the Adani conglomerate and its backers to reclaim control of a narrative that, its defenders say, has tarnished not just the company and its founding family but India itself.
Adani Group has denied allegations of misconduct by its executives and said it would defend itself in court.
The stakes for the conglomerate are high. In the wake of the charges, a stock rout has wiped out billions of dollars from Adani Group companies, while foreign governments and partners are reassessing ties. Kenya has canceled $2.6 billion in deals, and TotalEnergies SE halted new investments in the conglomerate.
“Any company or any other organization that is involved in a joint venture with the Adanis right now, they’re starting to worry about their liability,” said Kush Amin, a legal specialist at Transparency International, an anti-corruption group.
The pushback against the US action seems to have helped claw back some ground, at least for shareholders. The ports-to-power conglomerate had lost about $34 billion in combined market value since the US indictments became public on Nov. 21. This week it has recouped about $21 billion in market value, the single largest one-week jump since December last year.
On Friday, India’s Ministry of External Affairs said the indictment was a legal matter involving private firms and individuals and the US Department of Justice.
“We have not been informed in advance on the issue,” the ministry’s spokesman, Randhir Jaiswal, told reporters. “We have not had any conversation also on this particular matter with the US government.”
A Graver Threat
The indictment issued by federal prosecutors in Brooklyn on Nov. 21 accused Gautam Adani and associates of lying to US investors about their anti-bribery practices while promising more than $250 million in bribes to Indian officials. The indictment charges Adani company executives with three fraud counts, while other defendants are charged with violating the Foreign Corrupt Practices Act, or FCPA, which bars US-linked entities from bribing foreign officials.
FCPA charges can be particularly damaging because they can trigger stronger due diligence requirements among investors, said Ben Charoenwong, associate professor of finance at business school INSEAD in Singapore. They can also limit access to business contracts from governments and global firms — a particularly damaging prospect for an infrastructure company — as well as affecting personal banking relationships.
“This is why there’s such urgency in creating distance between individual family members and the allegations,” he said. “It’s not just about corporate reputation, which they can probably shrug off soon, but about preserving individual financial mobility and access to global financial markets.”
The US indictment also goes further, and poses a graver threat, than last year’s allegations from short-seller Hindenburg Group, which alleged a campaign of stock manipulation and accounting fraud by the conglomerate, experts said. While those accusations also led to a punishing stock rout — which later reversed — they didn’t carry the threat of criminal and financial penalties as the US charges do.
The Adani Group mounted a similar defense after those charges. The company issued a 413-page response at the time, while high-profile lawyers came to its defense. In parliament, Modi in a series of speeches deflected pressure from the opposition over alleged links to Gautam Adani.
This time, attempts by the opposition to raise the charges in parliament have been cut short. Sessions in the upper and lower house were adjourned over multiple days this week after the opposition demanded a discussion of the bribery case. On Tuesday, the lower house sat for just over 14 minutes.
“Many see this as an attack on the Indian system and want to defend it, for nationalist reasons,” said Sushant Singh, a lecturer at Yale University. Others, he added, “want to defend Adani as he is close to Modi and this would be an indirect defense of Modi.”
