Congress Asks 3 Questions on Adani Group's Links with Global Kleptocratic Network
Moneylife Digital Team 22 February 2023
In the 16th instalment of questions under the series, 'Hum Adani Ke Hai Kaun' (HAHK), the Congress party has asked three questions to prime minister (PM) Narendra Modi related to the alleged involvement of the Adani group in a global kleptocratic network involving other firms with deep political connections, including Russian VTB Bank and Cyprus-based New Leaina. 
 
Here are the three questions asked by Jairam Ramesh, member of Parliament (MP), general secretary (communications), Congress to the PM…
 
1. As we pointed out in our 19 February 2023 HAHK questions, the Adani Group has done several related-party transactions using Russia's VTB Bank, which has faced international sanctions for several years. VTB also makes an appearance in the Rosneft Oil purchase of an Essar-owned port and refinery in Gujarat for US$13bn (billion) on 14 October 2016 which, it was widely reported, Russian President Vladimir Putin and you played a critical role in finalising. However, a Russian analyst report stated that "we have estimated that Rosneft has agreed to pay at least twice as much as Essar Oil is worth."
 
Curiously enough, between 4 September 2015 and 28 October 2016, public sector firms ONGC, Oil India, Indian Oil and Bharat Petro Resources together bought a 49.9% stake in the Rosneft Oil subsidiary Vankorneft for US$4.23bn, in which VTB may also have been involved. Given continuously falling production at Vankorneft and a lack of management control over the asset, the former Russian deputy minister of energy Vladimir Milov stated that "the Indian companies have clearly overpaid for the Vankor stakes." 
 
This is a suspicious pattern in which public sector units overpay a Russian firm for an oil asset, which, in turn, overpays a politically-connected private Indian firm for another energy asset. Given your direct involvement in the Essar transaction, did you transfer Indian taxpayer money to the pockets of private Indian companies to help finance your political activities?
 
2. New Leaina is a Cyprus-based entity, 95% of whose investments have been in Adani group companies (adding up to US$420mn—million). The "ultimate beneficial owners" of this fund are linked to the financial services firm Amicorp. Amicorp is believed to have set up at least seven Adani entities, 17 offshore shell companies linked to Gautam Adani's brother Vinod and three Mauritius-based offshore investors in Adani group stock. Amicorp is notorious for its involvement in the "1MDB" scam in which US$4.5bn of funds from Malaysia's sovereign wealth fund "1Malaysia Development Berhad" were embezzled by senior political figures. One of the Amicorp entities implicated in that scam was until recently a shareholder in New Leaina. Are the Adani Group and other business houses involved in a global kleptocratic network to channel public funds into the coffers of politically-connected leaders in India?
 
3. New Leaina appears guilty of 'stock parking', in which a third party holds shares to conceal the actual owner's ownership or control before regulators. Since we know that SEBI has had these firms on its radar for some time now, what is the status of the investigation into the illegal practice of stock parking by shells and entities related to the Adani group? Are the firm's deep global links inhibiting a proper investigation?
 
Read about the previous questions here:
 
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