Author: Rasmita Jena

Billionaire Gautam Adani, head of the Adani Group, spoke out on Saturday about serious accusations from U.S. prosecutors, saying that challenges only make him stronger. While attending the Gem and Jewellery Awards in Jaipur, he mentioned, “Recently, we faced allegations about following laws at Adani Green Energy. This isn’t the first time we’ve faced issues. I can assure you that every challenge makes us tougher and turns obstacles into opportunities.”

Adani denied the claims, emphasizing that no one from his company has been charged with breaking the Foreign Corrupt Practices Act (FCPA) or trying to hide the truth. He noted that in today’s world, negative news spreads quickly, but he remains committed to following the rules.

The U.S. claims that Adani and his team were involved in a scheme to pay over $250 million in bribes to Indian officials for solar energy contracts. They also alleged that Adani made false statements to U.S. investors about the company’s anti-bribery measures.

In response to the accusations, the Adani Group labeled them as “baseless.” The political situation in India has heated up, with opposition parties, especially the Congress party, calling for an investigation into Adani.

The Indian government stated that the bribery allegations are a legal matter between the U.S. and private companies. “We see this as a legal issue involving private firms and the U.S. Department of Justice. We weren’t informed beforehand and have not discussed it with the U.S. government,” said Randhir Jaiswal, a spokesperson for India’s Ministry of External Affairs.

New Delhi: The government of Andhra Pradesh, led by N Chandrababu Naidu, is reviewing important documents about a huge solar power project with Adani Green Energy (AGEL) that provides 7,000 MW of energy. They discovered that the previous government, led by Y S Jaganmohan Reddy, made quick decisions about the project, raising some eyebrows.

The Solar Energy Corporation of India (SECI) initially contacted Andhra Pradesh’s government on September 15, 2021, about acquiring solar power. Just one day later, on September 16, the Cabinet approved the proposal.

Fast forward a bit, on November 5, the Andhra Pradesh Central Power Distribution Corporation (APCPDCL) told the state’s energy regulatory authority, APERC, to proceed with the project. This normally involves a detailed approval process that can take months, especially since public hearings are part of it. For example, a similar project took about six months to get approval. However, for the AGEL project, APERC approved it in just three days, on November 11.

By December 1, a power supply agreement was signed with SECI, completing the entire process in just two and a half months. Now, the Naidu government is thinking about asking SECI to cancel the agreement with AGEL and is considering whether they even need that much energy—7,000 MW.

Economists have lowered their growth predictions for India after new data showed that the country’s economy is growing more slowly than before. In the last quarter, from July to September, India’s economy grew at only 5.4%. This is the lowest rate in over a year and much less than what experts and the Reserve Bank of India expected, which was 7%.

Experts from companies like Goldman Sachs and Barclays have changed their forecasts. Goldman Sachs’ economists have reduced their growth estimate for this financial year to 6%, down from 6.4%. Other analysts have also lowered their expectations. They say the slowdown is because manufacturing activity is weaker than planned. Madhavi Arora, an economist from Emkay Global Financial Services, has also revised her prediction to 6% from 6.5%. She believes urban spending will remain low due to weak incomes, while any increase in rural spending is just temporary.

Falling wages, lower company profits, and high prices have made it hard for the economy to pick up in recent months. Because of this, several government officials are asking for lower interest rates. However, Reserve Bank of India Governor Shaktikanta Das is hesitant to do so, saying it could be risky with inflation still high. The next meeting about interest rates is coming up on December 6.

Experts believe the disappointing GDP numbers may push the government to accelerate its spending on projects. However, they don’t think the slowdown in manufacturing will get better quickly. Some believe there is now a better chance of rate cuts starting in December. Economists suggest that even if there isn’t a rate cut, the Reserve Bank might need to lower the amount of cash banks must keep in reserve or use other methods to help banks lend more money. The Reserve Bank will also need to update its forecasts for inflation and GDP growth during this meeting since the inflation numbers have been higher than earlier estimates, and the actual GDP growth is below what was expected.