High-ranking Andhra government official was offered ₹1,750 crore, says indictment against Adani
High-ranking Andhra government official was offered ₹1,750 crore, says indictment against Adani.
In the order by a federal court in Brooklyn, the US, indicting Adani Group Chairman Gautam Adani and seven others on charges of conspiring to commit financial fraud, has named government-owned power companies in India as part of the alleged bribery scheme.
The report stated that co-conspirators of the alleged bribe schemes, including Gautam Adani and others, offered and/or paid officials of state-owned power companies in India to enter into contracts with the Solar Energy Corporation of India (SECI) for an Adani-founded Indian renewable energy company, its subsidiary and a US company to obtain and retain businesses. SECI is a company under Government of India’s Ministry of New and Renewable Energy.
The indictment report has named Chhattisgarh State Power Distribution Company Limited, Tamil Nadu Generation and Distribution Corporation Limited, GRIDCO Limited, Jammu Kashmir Power Corporation Limited, Andhra Pradesh Central Power Distribution Corporation Limited, Andhra Pradesh Eastern Power Distribution Company Limited and Andhra Pradesh Southern Power Distribution Company Limited as “instrumentalists” of the Indian government.
It stated that the companies and its officials acted as “foreign officials” mentioned in the Foreign Corrupt Practices Act (FCPA), Title 15, United States Code, Sections 78dd-1(f)(1)(A) and 78dd-3(f)(2)(A).
The specific section of the Act is a federal law that prohibits payments, gifts, or offers of anything of value to a foreign official to influence any US official or secure an improper advantage in business in the US.
Related: US indicts Gautam Adani for bribe scheme to pay Indian government officials
The alleged corruption practice
To secure Power Purchase Agreements (PPAs) for renewable energy projects under the SECI, bribes were promised to Indian government officials. Andhra Pradesh emerged as a key player, agreeing to purchase seven gigawatts of solar power, the largest share among participating states.
Sagar Adani, a senior executive, maintained detailed notes tracking the bribes, including the amount, the officials involved, and the allocation by state. Andhra Pradesh alone accounted for $228 million (₹1,750 crore) in promised payments, the indictment said.
“In addition, the defendant GAUTAM S ADANI personally met with Foreign Official #1 in Andhra Pradesh to advance the execution of a PSA between SECI and Andhra Pradesh’s state electricity distribution companies, including on or about August 7, 2021, on or about September 12, 2021 and on or about November 20, 2021,” the indictment said.
“Approximately 1,750 crore rupees (approximately $228 million) of the corrupt payments was offered to Foreign Official #1 in exchange for Foreign Official #1 causing Andhra Pradesh’s state electricity distribution companies to agree to purchase seven gigawatts of solar power from SECI under the Manufacturing Linked Project,” it added.
According to the indictment, Foreign Official #1 was a citizen of India who resided in India.
“From approximately May 2019 through June 2024, Foreign Official #1 served as a high-ranking government official of Andhra Pradesh, India,” it said.
US officials claim that executives like Cyril Cabanes and Saurabh Agarwal were aware of the bribes during internal meetings and they strategised on fulfilling the US company’s share of payments while minimising exposure to external scrutiny.
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‘Development fees’
To disguise the payments, the conspirators explored various methods, such as transferring project rights to subsidiaries or misclassifying bribes as “development fees.” PowerPoint presentations and financial analyses were used to evaluate these options.
“Following the promise of bribes to Indian government officials, in or about and between July 2021 and February 2022, electricity distribution companies for the states and regions of Odisha, Jammu and Kashmir, Tamil Nadu, Chhattisgarh and Andhra Pradesh entered into PSAs with SECI under the Manufacturing Linked Project. Andhra Pradesh’s electricity distribution companies entered into a PSA with SECI on or about December 1, 2021, pursuant to which the state agreed to purchase approximately seven gigawatts of solar power- by far the largest amount of any Indian state or region,” the indictment said.
With agreements in place, the Adani-owned power company, listed in the Indian market, secured PPAs with SECI, ultimately benefiting from contracts worth billions of dollars. The project was celebrated as a breakthrough in renewable energy, while its underpinnings rested on systematic corruption.
“At the time of its award, the size and scope of the Manufacturing Linked Project was among the largest global solar energy projects. The Manufacturing Linked Project more than doubled the capacity of renewable power under the Indian Energy Company’s and the US Issuer’s portfolios. After the award, the Indian Energy Company issued a media release titled, “[the Indian Energy Company] Wins the World’s Largest Solar Award,” which included a statement from the defendant GAUTAM S ADANI that the Indian Energy Company was “honoured to be selected by SECI for this landmark solar award,” the indictment said.
(Edited by Muhammed Fazil.)
