An explosive
Washington Post investigation has revealed that Indian government officials drafted and approved a US$3.9bn (billion) plan to direct taxpayer-backed investments from the Life Insurance Corporation of India (LIC) into companies owned by billionaire Gautam Adani, a close ally of prime minister (PM) Narendra Modi.
According to internal documents obtained by The Washington Post reporters Pranshu Verma and Ravi Nair, the plan was conceived in May 2025 as Mr Adani’s debt-laden conglomerate faced mounting repayment pressure. The strategy — coordinated by officials from the department of financial services (DFS), the ministry of finance (MoF), LIC and the government think tank NITI Aayog — aimed to 'signal confidence in Adani group' and 'encourage participation from other investors', even as global lenders hesitated to extend credit following US bribery and fraud charges against the industrialist, the report says.
The report notes that LIC, a State-owned insurer that manages the savings of millions of low- and middle-income Indians, was advised to invest about US$3.4bn in Adani group corporate bonds and another US$507mn (million) to raise its equity stakes in subsidiaries including Adani Green Energy and Ambuja Cements. Finance ministry officials argued that Mr Adani’s bonds offered higher returns—up to 8.2%—than 10-year government securities, which yielded around 7.2%.
The plan materialised swiftly. On 30 May 2025, Adani Ports and Special Economic Zone (APSEZ) announced a Rs5,000 crore (or US$585mn) bond issue to refinance existing debt. The Post reported that the entire issue was subscribed by a single investor — LIC — a move that drew immediate political backlash, with critics denouncing it as a misuse of public funds to prop up a politically connected conglomerate.
“This government supports Adani and will not allow any harm or detriment to come to it,” independent corporate finance expert Hemindra Hazari told The Washington Post. Mr Hazari says it was 'abnormal' for LIC, which provides life insurance largely to poor and rural citizens, to invest such vast sums in a private company. “If anything happens to LIC, it is only the government that can bail it out,” he warned.
MoF formally approved the plan after coordination between DFS, LIC and NITI Aayog. Among its stated objectives were boosting investor confidence in Mr Adani’s empire — which had seen debt rise 20% over the previous year — and preventing market panic amid international legal scrutiny.
Mr Adani, India’s second-richest man with an estimated net worth of US$90bn, was charged in 2024 by the US department of justice with running a 'multi-billion-dollar scheme' that allegedly misled investors and involved over US$250mn in bribes to win energy contracts. The US securities and exchange commission (SEC) also brought civil fraud charges against Mr Adani and his nephew, Sagar Adani. The Adani group has denied all allegations, calling them 'baseless' and 'politically motivated', and asserting that 'these offences concern individuals, not Adani companies'.
The Post’s findings underscore how deeply interwoven Mr Adani’s business empire has become with India’s economic policy-making. The report cites DFS documents describing Mr Adani as a 'visionary entrepreneur' who had shown 'remarkable resilience in the face of significant challenges'. It also points out that government officials viewed his ports, energy and infrastructure companies as vital to India’s development objectives — despite US investigations, a 2023 stock manipulation controversy and ongoing financial volatility.
In 2023, Hindenburg Research accused the Adani group of accounting fraud and stock price manipulation, triggering a sharp selloff that wiped out billions in market value. Although India’s market regulator SEBI later dismissed two of the allegations, other inquiries remain open, according to Reuters. LIC’s own holdings in Adani companies had lost about US$5.6bn in paper value at the time, though some of those losses were later recovered.
The Post investigation also highlights geopolitical risks linked to Mr Adani’s ventures, including his stake in Israel’s Haifa port — which has faced threats from Houthi rebels — and notes that Indian officials were aware of potential political fallout. Opposition parties such as the Congress and CPI(M) have long accused the Modi government of misusing LIC funds to favour Adani, the report says.
Responding to The Post, Adani group 'categorically denied involvement in any alleged government plans to direct LIC funds', adding that LIC invests across multiple corporate groups and has earned returns from its exposure to Adani companies. The conglomerate says that “assertions of undue political favour are unfounded” and that its “growth predates Mr Modi’s national leadership.”
LIC, DFS and the prime minister’s office (PMO) did not respond to the newspaper’s requests for comment.
Analysts quoted by The Washington Post say the episode exemplifies India’s 'crony capitalism', where government support shields politically influential business groups from financial risk. “Adani is allowed to operate by a different set of rules,” Tim Buckley, director of the Australia-based think tank Climate Energy Finance told the Post. “Crony capitalism is alive and kicking.”
The report concludes that the Modi government’s plan to steer billions in public money toward Mr Adani’s debt-heavy empire demonstrates how state financial institutions are being used to stabilise the fortunes of one of India’s most powerful and politically connected businessmen — with taxpayers ultimately bearing the risk.
Am amazed that such utter nonsense published by Washington Post is even given any credence.
While it is a well accepted fact that in US corporate interests are accomodated even against National Interest - like Chevron not just even allowed to operate it's Venezuela oil fields but even being permitted to import Venezuela crude into US when most of the world has stopped importing it -
Moneylife should avoid publishing crap articles -
~I resigned from LIC being a Assistant Administrative Officer at the age of 32 without having any job in hand,so one can ascertain what is going on in this organisation.