Two recent exposures of the Gautam Adani conglomerate, have inflicted sufficient market punishment on it. One by the Hindenburgh short seller’s accusation of “brazen stock market manipulation and accounting fraud”, triggered an huge sell-off of its shares, wiping out about $118 billion of its market valuation. While the Bangalore – based Ken report’s exposure of non-repayment of debt worth $ 2.15 billion by the Adanis, triggered another sell-off resulting in a Rs. 50,000/- crore loss in Adani’s capitalisation. However, by present indications of lack of Opposition unity, the Adani group may be spared a Joint Parliamentary probe.
On a comparison between two Prime Ministers of India, Nehru and Modi, with respect to their capacity to hear criticism and listen to divergent views – the sine qua non of a vibrant democracy – Nehru emerges the clear winner. While Nehru allowed his own son-in-law Feroze Gandhi to break ranks with the ruling Congress party to expose the Haridas Mundhra scandal in Parliament, resulting in the resignation of Nehru’s friend Finance Minister TTK and 22 years’ jail for “adventurer” Mundhra by a Commission headed by Justice M.C. Chagla, who completed his public enquiry in 24 days flat. Whereas, the present incumbent wasted no time in disqualifying Rahul Gandh from Parliament after his conviction and sentence in a defamation case in Gujarat, even though the Gujarat Court had given Rahul time to appeal against his sentence.
When there was an outcry that the Government is creating monopolies in public services like ports and airports, the answer was that the policy was geared to strengthening the corporate sector, which is beneficial, rather than create monopoly. But as once Deputy Governor of the RBI, Professor R.K. Hazari had shown, in India the concentration of economic power lay in a few hands, that of the business or corporate house (instead of the individual firm) like Tata or Birla and now, Adani or Ambani. Following Hazari, I demonstrated in my article way back in the Economic & Political Weekly (EPW) Annual Number 1972, that in India product – monopoly and economy – wide monopoly coexist. In the last fifty yeas, the situation has not changed, rather perhaps aggravated, with only a few houses like Adani or Ambani and some others being added to the list. The Adani Group controls 14 ports, 7 airports, 4 coal – mines and its diverse businesses in India include electric power generation and transmission, renewable energy, natural gas, food processing and infrastructure, besides coal mines in Borneo (Indonesia) and Queensland (Australia), a port and two wind – power projects in Sri Lanka and the Haifa port in Israel. Quite like the old Indian sub-continent but much larger, the Adani Empire is spread wide from apple orchards in Himachal in the North to a under – water coal-mine and a port in Australia in the South, to another coal-mine in Borneo in the East and Haifa Port in the West. Mukesh Ambani’s conglomerate is also very big and wide- spread and includes Jio and a Zoo.
Researcher and Commentator Rupa Subramanya writing for Nikkei Asia attributes the rise of Adani and Ambani to their proximity to Narendra Modi, former CM of Gujarat and now India’s PM. The picture shines of Modi travelling in Adani’s jet for his 2014 election campaign and subsequent visit to Bangladesh in 2015 leading to the very unequal agreement for supply of electricity to Bangladesh from Adani’s Godda coal-powered electricity plant in Jharkhand, India. Subramanya terms this phenomena as “crony capitalism” and foresees this turning into ‘gangster capitalism’ of the kind seen in Russia. In fact GVK Ltd. was reaching a deal on Mumbai airport when the ED and CBI were arraigned against it. Later the GVK Ltd. decided to sell its interest to the Adani Group. Jai Ram Ramesh of the Congress in a public statement wondered why the PMO ignored the Niti Ayog’s recommendation not to hand over Mumbai airport to the “inexperienced” Adani group?. While the Bloomberg News sees Adani as America’s Rockefeller, I would rather view Gautam Adani as India’s Heny Ford whose photograph adorned the wall behind the Fuhrer’s desk.
My humble study of the economic behaviour of the monopoly houses in India in the late ‘60s and early ‘70s showed that they were characterized by three attributes: first, to restrict output and hike the price in a monopolistic market; second, to pre-empt new investment areas and shut out competition; and third to try to lay-off workers and lower their wages. All such traits have recently been seen in the case of the Adani Group.
It is in this scenario, that another former Deputy Governor of the RBI , Professor Viral Acharya has proposed the breakup of the Big 5 conglomerates, as a countervailing exercise against the monopolistic tendencies in the economy. In an astonishingly honest analysis of economy – wide trends, the journal Peoples’ Review in a May 2021 article, has concluded that “Adani’s wealth increase amid rising poverty reaffirms why capitalism is the pandemic”. Indeed, Professor Viral Acharya’s suggestion for control of monopoly appears apt when the Competition Commission is seen as a lame duck, pretending to control monopoly but failing to do so.
What does the phenomenon of sparing the Adani Group from the JPC or any other judicial or Parliamentary restraint, reflect? In short, it reflects four things: an unequal, fragile democracy; a divided people lacking the leadership of a Gandhi navigating the Dandi March against tax on common salt or even the Quit India movement; the significant role of the RSS on a Pan-Indian basis to influence the society as well as polity, as sharply reflected in the recent re-writing of history in the NCERT school text – books by purging extracts on Hindu extremists’ dislike for Mahatma Gandhi and the RSS ban after Gandi’s assassination; and, finally, an
indulgent compact of competitive imperialism. In 2017, when India boycotted the Beijing Summit on China’s OBOR, (One Belt One Road) project, it transpired that Modi had already turned down China’s overtures to co-sponser the OBOR project. Now that India is part of The Quad, a four nation group of the US, Japan, Australia and India to oversee the Indian Ocean and the Indo – Pacific and protect it from Chinese incursions, why India refused China’s offer of co-sponsorship of the OBOR project, now becomes very clear.
But things are changing fast in the geo- politics of the world. Now another grouping is emerging on the international scene: that of China, Russia, Iran and Saudi Arabia. This may be called as a compact of competitive imperialism. It is in this background that the news comes that Adani has appointed a former Israeli envoy to India, Ron Malka as the Executive Chairman of Adani’s Haifa port. The importance of Adani is revealed by the presence of the Israeli Prime Minister Benjamin Netanyahu by the side of Gautam Adani at the inauguration of Adani’s takeover of Haifa port.
As reported in the online Middle East Eye this March, “the $ 1.2 billion purchase of Haifa Port by billionaire Adani, will accelerate Israel’s integration into the Middle East as it expands and deepens its occupation over Palestinian life and land.” Whereas the Israeli Prime Minister Benjamin Netanhayu described the Adani deal as “ liberating”, a critical researcher of the subject – Sarr Plonski of the Queen Mary University, London – says “Haifa port has been a key site of Zionist and Israeli nation building”.
My memories of a short visit to Haifa in the summer of 1968 55 years ago, as a suburban town, assure me that Adani’s promise of improving Haifa’s skyline hold much hope for Israeli expansion in Palestinian territory. The subsequent appointment of a former Israeli ambassador to India, as Adani’s chief executive of Haifa port only underlines the importance of Haifa and Adani to Israeli expansionist plans.
It is precisely here that the enigmatic George Soros of Open Society Foundation and Human Rights Watch, comes in. Eli Lake writing for Bloomberg headlines the fact that a “Marginalized Israel” is anti – Zionist Jewish George Soros’ plan, as he has distributed large sums of philanthropic money among Palestinian groups. George Soros would like Israeli expansionism to be contained. That’s why Soros does not like Adani.
For the moment, Gautam Adani has little to fear, backed as he is by national and international forces, whereas the opposition in India is disunited and the people are divided without a palpable leadership. The only glimmer of hope will be the possibility of a concerted campaign to materialize Professor Viral Acharya’s nascent idea to contain and control monopoly. Even in the United States, there is effective anti-trust legislation. Why should it not be in India too?
Aurobindo Ghose, writer, lawyer, human rights activist and author of numerous articles on Monopoly in India and a Ph.D dissertation on “Monopoly in a Mixed Economy: case of India”. He can be contact at [email protected]
