Adani embroiled in African corruption scandal via arms deal

by | Jun 13, 2017 | Energy & Environment

The Adani Group has become embroiled in a corruption scandal in South Africa after a series of leaked emails revealed the Indian power company was in talks to do a weapons deal with the controversial Gupta family.

Adani Mining, which is behind the Carmichael mine – the world’s biggest new thermal coal project in the Galilee Basin in Queensland – is owned by Adani Enterprises. It is Adani Enterprises which has been identified in the leaked emails as
being in discussions with the Gupta family to enter the arms business.

The unfolding scandal will lend further credence to calls that Adani should not pass the “fit and proper person” test and be granted large taxpayer subsidies to build its coal mine and railway in Australia.

Adani has been gifted an unlimited water licence by the Queensland government and a royalties deferral arrangement. The federal government, via its Northern Australia Infrastructure Facility (NAIF), is considering a $1 billion discount loan to a Caymans Islands-controlled Adani entity to build a railway line.

Several Australian government ministers have spoken favourably about the subsidies despite Adani companies and family members being embroiled in scandals in India in the past.

This latest scandal is bigger. Today, the chairman of South Africa’s monopoly power utility Eskom stood down. This followed a raft of other Eskom scalps and the scandal is engulfing the family of President Jacob Zuma.

According to the Economic Times of India, the leaked emails from the Gupta family show that discussions had been afoot between the Gupta’s scandal-plagued Denel group and the Adani Group.

The Gupta family had been trying to establish a company called Denel India in which Adani Enterprises was to have taken a 33 per cent stake.

Adani conceded it had been in talks with Denel but said it did not pursue the matter.

“This is common in defence or any other business where everyone talks to everyone but business is pursued only after rigorous due diligence. Adani Group has no relationship with Denel,” said the report, quoting an Adani spokesperson.

Denel had been banned in India for almost ten years as authorities conducted a corruption probe over weapons purchases.

In South Africa, the Guptas had endeavoured to convince Eskom to give them money so they could buy a thermal coal mine with the son of the President Jacob Zuma. Glencore was the seller and Eskom stood to purchase the coal to the benefit of the Gupta family.

Meanwhile in Australia, on behalf of the Adanis, the federal and Queensland governments are endeavouring to convince the taxpayers to give them money in order to subsidise the export of thermal coal to India via a series of transactions which will benefit the Adani family.

The scandal in South Africa is likely to leave opponents of the Carmichael project even more unimpressed. One, Tim Buckley, director of IEEFA, told tonight, “Even without taxpayer subsidies the Adani project is a white elephant and, in oversupplying the seaborne thermal coal market, a market in structural decline, this mine is contrary to Australia’s national interest.

“I think this linkage to coal-corruption in South Africa and special deals with Modi’s government by Adani is a major credibility hit for Adani here, particularly as it relates to the probity of the NAIF subsidised loan and the Queensland royalty holiday, not to mention free water.”

Indian Prime Minister Narendra Modi has been on an anti-corruption campaign but is an associate of Gautam Adani. The scandal is not a good look for Indian authorities either.

Editor’s Note:

Readers can scroll down #GuptaLeaks Twitter timeline below and join in:


Michael West

Michael West

Michael West established to focus on journalism of high public interest, particularly the rising power of corporations over democracy. Formerly a journalist and editor at Fairfax newspapers and a columnist at News Corp, West was appointed Adjunct Associate Professor at the University of Sydney’s School of Social and Political Sciences. You can follow Michael on Twitter @MichaelWestBiz.


  1. Avatar

    There is so much damning evidence against Adani and yet our politicians are turning a blind eye. So I really want to know why both govts are bending over backwards?

    • Avatar

      A bit off topic.
      Tax cuts.
      It will create jobs?
      But how many businesses would a 5% drop in the tax rate translate to say $75,000 which could employ 1 person.
      I think working out the exercise above might prove that job creation would be very minimal.
      As for the top end, say the bankers, they’re making billions in profit and at the same time slashing costs and personnel. The banks will pocket the extra cash especially the CEO’s.

    • Sandi Keane

      Wonder what they’ll say about the latest scandal? Adani-talk stealing all the oxygen at the moment. Coalition’s agenda gets more paralysed by the day.

    • Avatar

      In India too, Adani has looted the common public but he gets away with almost anything as the indian PM is his close associate and he accompanies the PM on most of his foreign trips and gets a business deal with almost all the countries he accompanies the PM. The main reason for this is that he has given the Indian PM lotta funds for election campaigning, private jets for travel, etc while he was a PM candidate and also while he was a CM candidate before becoming a PM and hence none of the indian govt agencies can touch Adani. But what surprises me the most is, how is the Australian govt doing such an injustice to its ppl and co-operating with such a shady businessman?

    • Avatar

      Adani’s modus operandi everywhere else is to bribe public officials. Why would it be different in Australia? The level of political support Adani is getting in the face of overwhelming evidence indicates to me it is not the measly donations to both NLP and Labor that is doing the trick. Could sdomebody somewhere be copping millions? Would a Federal ICAC be of use in investigating this?

  2. Avatar

    “Adani has been gifted an unlimited water licence by the Queensland government and a royalties deferral arrangement.” Townsville’s water supply is at 20%… how can this ‘gift’ be allowed?

    • Michael West

      That is an extremely good question Philip!

    • Sandi Keane

      Just share your comment on Twitter. Agree. Good question. Just watched film on Galilee Basin last night Hawthorn Town Hall. Alan Kohler spoke as well on Adani. Hall seats 600, they turned 300 away… and we’re all in Josh Frydenberg’s electorate of Kooyong. BTW Kooyongers voted overwhelmingly to abandon Carmichael and railway on ReachTel a few days ago.

  3. Avatar

    On May 1st Labor`s Op Enviro Shadow,Mark Butler made a statement as to Adani
    On the same day Bill Shorten said this ” Labor has backed away from supporting Adani’s proposed Carmichael coalmine ”

    No MSM reports this

    We have to go to Green Left Weekly to find out

    • Sandi Keane

      Just tweeted your comment out….

      • Avatar

        Indigenous Labor senator Pat Dodson said the changes would restore certainty to the native title system, and were made after extensive consultation with indigenous groups.

  4. Avatar

    Near three quarters of a million unemployed and more than 1.1 million underemployed. Jobs and growth my arse.
    The Turnbull neocon narrative explains these figures away by arguing that in the neocon individualist world view you are the sole cause of your circumstances- very handy world view for those at the top and in power as it means they don’t think they have to do a damned thing other than eliminate all threats to their hold on power and privilege.

    So the foolish poor, the self indulgent weak, the tough luck sick and the hapless pensioners of every kind are, in the Turnbull ministry world view, simply stupid bludging Australians who should have made better choices before birth.

    Cognitive dissonance is the modus operandi of the neoconservative.

  5. Avatar

    Board positions. That’s my bet. You watch how many of these treacherous suits will end up on a fat retainer for their four appearance a year advisory position. Follow their career post selling us out and you’ll find out what’s in it for them.

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