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5 points in the indictment of Indian billionaire Gautam Adani

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The indictment of Indian tycoon Gautam Adani, Asia’s second richest man, on bribery charges in a U.S. federal court on Wednesday shocked India.

The charges put his empire under renewed scrutiny less than two years after allegations of financial irregularities by short-seller Hindenburg Research wiped $130bn off the group’s public market value.

Who is Gautam Adani?

Gautam Adani is the founder and chairman of the Adani Group, which has interests in renewable energy, ports, airports, construction materials, food and media. He is often referred to as ‘Number 1’ and ‘Big Man’ by other defendants in the case.

Adani, 62, from a middle-income textile family in the western Indian state of Gujarat, set up his group in 1988 to trade in commodities. Over time, Adani grew his business through an aggressive leverage strategy, moving into many sectors critical to the country’s infrastructure. The group was worth around $170 billion before the indictment led to the sale of its listed assets.

Adani’s rise mirrors that of Indian Prime Minister Narendra Modi, himself from Gujarat. Modi’s political opponents have often claimed that Modi has favored the billionaire, as Adani has benefited greatly from the tenders it has won for public projects thanks to the Modi government’s infrastructure development drive. Both Adani and the government have denied any special treatment.

What are the charges?

U.S. prosecutors allege that Gautam Adani, his nephew Sagar Adani and six other defendants conspired to pay $265 million in bribes to Indian government officials to secure ‘lucrative solar power supply contracts’. The defendants also allegedly ‘concealed’ the bribes from U.S.-based investors in order to ‘obtain billions of dollars in financing’.

The bribery scheme, dubbed the ‘Corrupt Solar Power Project’ in the indictment, centered on numerous solar power contracts awarded by the state-owned Solar Energy Corporation of India to Adani’s renewable energy unit and another Indian company, Azure Power.

Adani and others have also been charged by the U.S. Securities and Exchange Commission with making ‘materially false or misleading’ statements about anti-bribery practices when raising $750 million from investors in September 2021, including $175 million from U.S. investors.

How will the indictment affect the Group’s business?

Following the indictment, 11 of the conglomerate’s twelve companies collectively lost around $27 billion in value on Thursday, a repeat of the collapse in January 2023, when Hindenburg Research accused the group of stock manipulation and improper use of offshore tax havens, among other allegations.

Shares in holding company Adani Enterprises fell more than 22%, while shares in Adani Green Energy, the focus of the investigation, fell nearly 19%. Only New Delhi Television (NDTV), the news media arm of the conglomerate, closed marginally higher. Shares in most Adani companies continued to fall in early trading on Friday.

“The indictment could affect Adani’s upcoming fundraising plans. Adani Green Energy has reportedly cancelled the sale of $600 million in U.S. dollar-denominated bonds. The biggest short-term impact of this development is that the Adani Group may find it difficult to raise new funds, especially from leading financial institutions, until its name is cleared,” said Abhishek Basumallick, founder of investment advisory firm Intelsense.

Late on Thursday, Kenyan President William Ruto said he was cancelling Adani’s purchase of a controlling stake in the country’s main airport and a $736 million public-private partnership with the company to build power transmission lines.

How have the Adani Group and the Indian government responded?

In a statement on Thursday, the Adani Group rejected the charges in the indictment, calling them ‘baseless’.

As the U.S. Department of Justice has stated, the charges in the indictment are allegations and the defendants are presumed innocent until proven guilty,’ the group said in a statement: ‘All available legal remedies will be pursued.

There has been no official reaction from the Indian government.

Jaideep Mazumdar, Joint Secretary (East) in the Ministry of External Affairs, declined to comment when asked about the Adani issue during a press conference on Modi’s visit to Guyana in South America. “This is a press conference organised for the Indian Prime Minister’s visit to Guyana and the India-CARICOM (Caribbean Community) Summit, and I am not in a position to respond to questions beyond this mandate,” he said in Guyana’s capital, Georgetown.

Modi’s political rivals have launched a series of attacks on the billionaire.

Rahul Gandhi, senior leader of the Indian National Congress, said at a press conference on Thursday: “Adani has in a way taken over India; the country is in the grip of Adani. So, India’s airports, ports, defence industry… it is a partnership. Modi is on one side of the partnership and Adani is on the other,” he said.

Gandhi is also the leader of the opposition in the lower house of parliament and is in a powerful position to have a say in the appointment of a director of the Central Bureau of Investigation, the country’s anti-crime agency. Gandhi said his party would raise Adani’s charges in the winter session of parliament, which begins on Monday.

Is extradition expected to come up?

There is an ongoing investigation into Adani, launched last year by India’s securities regulator in the wake of the Hindenburg Research allegations.

Lawyers in India and the U.S. have said that U.S. prosecutors may seek the extradition of Adani and other defendants in the latest charges. The two countries have had an extradition treaty in place since 1997.

Prashant Mendiratta, a lawyer at the Delhi High Court, said the Indian Ministry of External Affairs would be the primary decision-maker if the U.S. government made an extradition request.

“If the Indian government refuses extradition, the prosecution can approach the Indian judiciary with a petition against the decision … there is a high probability that this will turn into a two-front legal battle,” Mendiratta added.

The Indo-U.S. extradition treaty also stipulates that an offence must be punishable by imprisonment of one year or more before extradition can be granted. Under India’s Bharatiya Nagarik Suraksha Sanhita (BNSS) Act, bribery is only punishable by up to one year in prison.

The more stringent Prevention of Corruption Act (PoCA) can also be applied in this case.

However, for the PoCA to apply, it must be proven that a bribe was solicited and accepted by the government official.

“Obviously we are aware of these allegations,” White House spokeswoman Karine Jean-Pierre said at a press briefing on Thursday when asked if the U.S. was concerned that the charges against Adani could damage bilateral relations: “What I would say is that we believe that the relationship between the United States and India rests on an extremely strong foundation based on the relationship between our peoples and cooperation on the full range of global issues.”

ASIA

Syria will not follow Afghanistan’s Taliban model of governance

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In an astonishing statement, Ahmed Shará, also known as Abu Mohamad Jolani, the leader of the Hayat Tahrir al-Sham (HTS) said that he will allow the girls to go to schools and will not turn Syria like Afghanistan under the rule of the Taliban.

Jolani, the de facto ruler of Syria, said that he will distance himself from the Taliban’s strict policies on women’s rights, and said that Syria will not follow the Taliban’s mode of governance.  

Jolani, who brought down the government of Bashar al-Assad and also widely welcomed by the Taliban, said that he believes in the education of women and girls and will not make Syria like Afghanistan.

“Syria is a diverse society with various ideas, unlike Afghanistan, which is more tribal. The Afghan model cannot be applied here,” Jolani told a BBC reporter.

Jolani says that Syria is a diverse society with various ideas, unlike Afghanistan, which is more tribal.

Jolani’s comment came when the Taliban congratulated the HTS-led victory by Jolani over Assad’s regime after years of fighting. The Afghan Foreign Ministry celebrated Jolani’s victory through a statement and hoped Jolani can bring peace and stability in the country.

“It is hoped that the power transition process is advanced in a manner that lays the foundation of a sovereign and serve-oriented Islamic government in the line with the aspiration of the Syrian people; that unifies the entire population without discrimination and retribution through adoption of a general assembly; and a positive foreign policy with world countries the safeguard Syria from a threat of negative rivalries of foreign actors and creates conditions for the return of millions of refugees,” the statement by Taliban Foreign Ministry.

However, Jolan’s position on the rights of women and girls is in great contrast with the current view of the Taliban leadership. Women and girls have been banned from education and work since the return of the Taliban in August 2021, following the collapse of the Republic System and withdrawal of the US troops from Afghanistan. Girls and women are even banned from medical institutions and visiting public spaces.

Jolani says he has a plan to create a government based institution and a council chosen by the people. 

The situation got worse when the Taliban’s Ministry for the Promotion of Virtue and Prevention of Vice called women’s voices “immodest” compounding their exclusion from public life. This year, it has been marked as three years since girls were banned from pursuing education over sixth grade. Besides that, on December 20, 2022, the Taliban’s Ministry of Higher Education announced that women would be barred from attending public and private universities.    

In an interview with CNN, Jolani said that he has a plan to create a government based on institutions and a “council chosen by the people.”

“When we talk about objectives, the goal of the revolution remains the overthrow of this regime. It is our right to use all available means to achieve that goal,” said Jolani.

“The seeds of the regime’s defeat have always been within it… the Iranians attempted to revive the regime, buying it time, and later the Russians also tried to prop it up. But the truth remains: this regime is dead.”

Moreover, he also said the Syrian people are the “rightful owners” of the country after the ouster of Assad, and declared a “new history” has been written for the entire Middle East.

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ASIA

Yoon summoned again for questioning on treason charges

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A joint law enforcement team investigating South Korea’s martial law case announced on Friday that it has issued a second summons to ousted President Yoon Suk Yeol, requesting his presence for questioning next week. The inquiry concerns his alleged involvement in the failed implementation of martial law.

The team has scheduled the questioning for 10:00 a.m. next Wednesday at the Corruption Investigation Office for Senior Officials (CIO) headquarters in Gwacheon, located just south of Seoul. This marks the second summons after Yoon refused to cooperate with the initial notice earlier this week.

The decision to hold the questioning on a public holiday appears to be a strategic move by the CIO, likely aimed at addressing security concerns. The office confirmed that the summonses were delivered via express mail and electronically to both Yoon’s residence and the presidential office in Yongsan. Notably, after Yoon’s team refused to accept the first subpoena, the CIO opted against delivering the documents in person for this round.

The investigation focuses on Yoon’s role in the December 3 martial law declaration, which he revoked following a vote in the National Assembly. If Yoon continues to disregard the summons without valid justification, the CIO may seek a court order to detain him for up to 48 hours.

Yoon faces allegations of sedition and abuse of office, charges that have gained traction since his dismissal by parliament last Saturday. His suspension from office remains in effect pending a decision by the Constitutional Court, which will determine whether he is permanently removed or reinstated.

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ASIA

Xi Jinping champions economic diversification during Macau visit

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During a three-day visit to Macau commemorating the 25th anniversary of its return to Chinese sovereignty from Portugal, President Xi Jinping emphasized the importance of economic diversification and maintaining the “one country, two systems” framework.

Speaking at the swearing-in ceremony for Macau’s new Chief Executive Officer, Sam Hou-fai, Xi urged the administration to make economic diversification the city’s primary focus. Sam, the fourth leader since the 1999 handover and the first mainland-born Chinese official to hold the position, is expected to align closely with Beijing’s objectives to reduce Macau’s reliance on gambling. The gambling industry, which accounts for approximately 80% of Macau’s tax revenue, has been the cornerstone of its rapid economic growth in recent years.

“Macau should prioritize proper economic diversification,” Xi stated, calling for enhanced policy support and investment in emerging sectors. He also reiterated the significance of the “one country, two systems” principle, stressing its role in ensuring the city’s “prosperity and stability” for the long term.

Xi’s visit included stops at the Macau University of Science and Technology, where he explored laboratories focusing on traditional Chinese medicine and planetary science. He also attended a cultural performance at the Macau Dome and met with local stakeholders, according to Chinese state media. His trip marked a shift in tone, with Anthony Lawrence, founder of Intelligence Macau, noting that it was the first time Xi publicly praised Macau for its progress rather than delivering critiques or instructions.

Since the liberalization of Macau’s gaming monopoly in 2002, the city has attracted significant foreign investment, including from prominent US casino operators such as Las Vegas Sands, MGM, and Wynn Resorts. However, the economy struggled during the COVID-19 pandemic due to travel restrictions, and recovery has only recently begun.

On Friday, Macau’s casinos were bustling with visitors, while non-gaming initiatives like a stamp exhibition co-organized by MGM China and Beijing’s Palace Museum showcased the city’s efforts to diversify its offerings.

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