A renewable energy company led by Indian billionaire Gautam Adani signed a contract in June 2020 to supply 8 gigawatts of solar energy to a state-owned utility, claiming it was the largest solar development contract ever awarded. However, local power providers complained about the expense and endangered the partnership.
In an attempt to salvage the arrangement, Adani allegedly used bribery to persuade local officials to purchase the electricity. Presumed to be in India, Adani denied the accusations, calling them "baseless," and vowed to pursue all legal options.
US authorities were interested in the alleged bribery plot because Adani's companies were soliciting money from American investors and promised hundreds of millions of dollars to Indian politicians.As a result, the US Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) brought civil and criminal charges.
The allegations are based on a 54-page DOJ indictment and related SEC lawsuits that detail the purported conspiracy and include correspondence between the parties.
In early 2020, the Solar Energy Corporation of India awarded Adani Green Energy and Azure Power Global a 12-gigawatt solar project. This milestone marked a leap for Adani Green Energy, managed by Adani’s nephew, Sagar Adani, whose company had minimal earnings and had yet to turn a profit.
Local electricity wholesalers were hesitant to commit to purchasing the power since they anticipated a drop in rates, which created obstacles. According to reports from April 2021, Adani and Azure executives discussed possible bribery as a result of these delays.
Azure's CEO allegedly said on WhatsApp that local power providers were being "motivated," to which Sagar Adani allegedly responded, "Yup... but the optics are very difficult to cover," according to the SEC complaint. In a letter allegedly sent in February 2021, Sagar Adani claimed that "incentives" had been doubled to expedite clearances.
Despite not being named as a defendant by the SEC, documents show that Ranjit Gupta was the CEO of Azure at the time. Gupta has not addressed the accusations; he is currently being charged by the DOJ with conspiracy to violate anti-bribery statutes. According to Azure, the implicated individuals departed the company more than a year ago, and the company is assisting with the investigations.
Gautam Adani allegedly proposed $228 million in bribes in exchange for a promise to purchase electricity during a meeting with an Andhra Pradesh official in August 2021. The DOJ said additional states had followed suit after the state pledged to buy the electricity by December.
A December 2021 meeting among Azure executives included discussions about “rumors that the Adanis had somehow facilitated the signing” of the contracts. Around this time, Adani publicly announced plans to make his company the world’s largest renewables player by 2030.
After the SEC mentioned Azure and Adani Green's "sudden good fortune," the market started making assumptions about the contracts. When the SEC questioned Azure about its recent transactions and conversations with foreign officials in March 2022, the investigation grew more intense.
Adani allegedly stated to Azure representatives in April 2022 that he anticipated receiving over $80 million in return for the payments he paid on their behalf. According to reports, a significant investor and Azure officials decided to give Adani's business ownership of a successful project as an incentive.
Prosecutors claim that Azure representatives concealed their role in the scheme, misleading Azure’s board about Adani’s request for bribe repayments. Meanwhile, Adani’s companies raised billions of dollars through loans and bonds from international banks, including US investors, while falsely asserting they had not paid bribes.
FBI officers looking into possible fraud and anti-bribery law crimes confiscated Sagar Adani's electronic devices on March 17, 2023, when he was in the United States. Gautam Adani allegedly took a picture of the search warrant the next day and sent it to himself via email.
Significant financial transactions, including a $1.36 billion syndicated loan in December 2023 and another bond sale in March 2024, were carried out by Adani's businesses in spite of the probe. The prosecution contends that fraudulent anti-bribery allegations deceived investors.
In October 2024, Gautam Adani, Sagar Adani, Ranjit Gupta, and five other alleged participants were charged by a secret grand jury with involvement in the bribery plot. On November 20, the indictment was made public.
Following the charges' disclosure, Adani_Group companies experienced significant market repercussions, with their valuation dropping by $27 billion. The repercussions led to the cancellation of Adani Green Energy's $600 million bond sale.
Adani Group has denied every allegation and emphasised its intention to take legal action. Azure has also distanced itself from the defendants, asserting cooperation with US authorities.
As big projects face resistance from regional distributors and mounting calls for lower rates, the debate highlights the challenges facing India's renewable energy sector.
The matter presents broader concerns about openness and ethics in international investments and the advancement of renewable energy sources as US investigators continue their investigation.
