- Sunday, May 05, 2024
The Joe Biden administration’s verdict came before extending the Adani Group $553 million for a container terminal in Sri Lanka.
By: Shubham Ghosh
THE Joe Biden administration of the US has said that short-seller Hindenburg Research’s allegations against Indian billionaire Gautam Adani of engaging in corporate fraud were not relevant before extending his company $553 million (£437.4 million) for a container terminal in the southern maritime neighbour of Sri Lanka, a senior official in Washington DC has said, Bloomberg reported.
The accusations outlined in a harsh report by the American short-seller that led to a roughly $100 billion (£79 billion) reduction in the Adani Group’s market value earlier this year, took center stage during the due diligence probe conducted by the International Development Finance Corp. (DFC) of the Indian conglomerate, as stated by a representative from the US agency to Bloomberg.
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The DFC expressed satisfaction that the allegations highlighted in Hindenburg’s report, which accused Adani of pulling off “the largest con in corporate history”, were not applicable to Adani Ports & Special Economic Zone Ltd, the subsidiary leading the project in the island-nation, the official added on the condition of anonymity.
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The official emphasized that the US agency will persist in overseeing the company to prevent inadvertent support for financial misconduct or any other inappropriate behaviour. The official also highlighted that the US adopts a distinct approach to infrastructure projects compared to China.
The Adani Group, which denied the allegations brought by the short-seller’s report and its stocks rallied late, saw the DFC’s investment as a vote of confidence following the Hindenburg fiasco.
“We see this as a reaffirmation by the international community of our vision, our capabilities and our governance,” Karan Adani, Gautam’s son and chief executive officer at Adani Ports, told the media in Colombo when the deal was announced.
The port deal in Sri Lanka involving Adani marks one of the biggest US-backed infrastructure projects in Asia.
It comes after years of efforts by Washington to counter growing Chinese influence in the region as a result of its president Xi Jinping’s Belt and Road Initiative to build infrastructure globally.
The DFC’s take on the Adani-Hindenburg episode also comes at a time when speculation is rife over the future of India-US relations that are witnessing a smooth sailing in the wake of the allegations that India is behind a plot to assassinate a Sikh separatist leader living in America.
