“Several foreign governments are now approaching us to work in their geographies and help build their infrastructure. Therefore, in 2022, we have also laid the foundation for broader expansion beyond India’s borders,” said Adani Group Chairman and Founder Gautam Adani, now the third richest person in India. world, in a virtual address to shareholders during the annual general meeting. of Adani Enterprises Ltd in July this year.
In fact, the Adani group had scouted overseas much earlier. Since 2010, the Adani Group has been in Australia, developing the Carmichael Coal Mine in Queensland despite massive nationwide protests over environmental and other concerns. The mine is now operational, although not as large as expected, and has started exporting.
In 2017, Adani Ports and Special Economic Zones (Ltd) signed a memorandum of understanding for a new multi-purpose port for container handling at Carey Island in Selangor State, about 50 km southwest of Kuala Lumpur . With Malaysia being a crucial link in China’s Belt and Road initiative, Adani’s interest ran contrary to the expectation that a Chinese investor would be hired for a mega port and sea city project on Carey Island. Like Carmichael, however, the port project ran into local opposition. A feasibility study is still in progress.
Over the past two years, however, the company has aggressively pursued international infrastructure projects. In May 2022, APSEZ made a winning $1.18 billion bid for the Israeli state-owned port of Haifa, together with Israeli chemicals and logistics company Gadot. The Adani company will hold 70% of the shares of the port. Down the road from Haifa is another port operated by Chinese state-owned Shanghai International Port Group, and the two are expected to compete for business.
In August this year, APSEZ and Abu Dhabi’s AD Ports Group signed a memorandum of understanding for “joint strategic investments” in Tanzania. In their sights is the port of Bagamoyo, previously jointly developed by China Merchants Holdings International and Oman’s State Government Reserve Fund (SGRF) under a 2013 agreement with the Tanzanian government. The port was supposed to be a premium BRI project. But he struggled to take off. Two years ago, the contract was canceled after then-chairman John Magufuli called the terms “exploitative and clumsy”. The new ASEZ-AD MoU will look at a bunch of infrastructure projects in addition to Bagamoyo in the East African Indian Ocean nation – rail, maritime services, digital services and industrial zones.
Is it just a coincidence that Adani’s global expansion closely masks the Chinese footprint along its Belt and Road Initiative? Or is it that, as Delhi competes with China for influence in the neighborhood and beyond, the Adani Group’s size, resources and capacity are seen as key in achieving strategic goals? of India than has been possible so far. Be that as it may, India’s infrastructure diplomacy is now globally identified with one company.
For the Adani Group, described as India’s largest port and logistics company, there couldn’t have been a better time. As the Quad Group of Australia, India, Japan and the United States competes with China in the Indo-Pacific, it has pledged to “catalyze infrastructure delivery” by putting more $50 billion on the table for “assistance and investment” in the Indo-Pacific over the next five years and “stimulating public and private investment to fill the gaps”. The Australia-India free trade agreement signed earlier this year, which grants coal imported from Australia duty-free access to India, is no small detail for Adani.
Adani-AD Ports’ joint interest in Tanzania came at a time when India, Israel, the United Arab Emirates and the United States came together as the “Quad of the Middle East” to take up the China’s challenge outside the Indo-Pacific.
In Sri Lanka, controversy erupted over the award of two wind power projects to Adani Green Energy Ltd last year, after an official said he had been asked to give the green light to the project. project by President Gotabaya Rajapaksa under pressure from the Indian Prime Minister.
It was not the first time that Adani emerged as the go-to company for Indian projects in Sri Lanka.
Under a Sri Lanka-Japan-India agreement, APSEZ was to develop and operate the East Container Terminal at the Port of Colombo. The Rajapaksa government abruptly canceled this deal in January 2021, and then offered the Western Container Terminal as a consolation. Adani is developing it jointly with a Sri Lankan partner. In either case, it’s unclear why or through what process Adani was the chosen Indian developer.
Even as many in Sri Lanka worry about these “secret deals,” Sri Lankan officials appear to have made a pragmatic peace with the choice. “80% of the activity of the port of Colombo is transhipment. Of this amount, 70% is destined for India. And of this 70%, 35% goes to the ports held by Adani. With the arrival of Adani with 3 million TEUs (20ft equivalent) in the Western Container Terminal, our capacity of 7.5 million TEUs increases significantly,” said the High Commissioner of Sri Lanka in India, Milinda Moragoda, in an interview with The Indian Express in January.
Adani’s new “hands-free” model for doing business with its neighbors – a power plant in Jharkhand, exporting all its output to Bangladesh – has been seen as a “win-win” deal. One official compared the “success” of this model to Nepal, where Indian projects have been stalled for decades due to local politics and other obstacles. Jharkhand was not without problems, but as Adani tweeted after his meeting with Prime Minister Sheikh Hasina in Delhi earlier this month, the project is ready to send 1500 MW to Bangladesh by Bijoy Dibosh in December 2022, six years after a memorandum of understanding for this has been signed.
The link between diplomacy and business interests has generated its share of debate, particularly in the United States, where its diplomats, intelligence agencies and military interventions abroad have actively pushed the interests of big business – first the hunting for cheaper raw materials, then markets abroad, then moving industry where labor was cheaper. As seen in the new-era trading blocs – the US-led IPEF and the China-dominated RCEP – economic interests are at the heart of geopolitics.
At a time when global rivalries are sharpening in the shadow of war in Europe and India is looking out for its own interests, pushing powerful corporations to the center of its diplomacy, whether building ports , to buy or sell weapons or to make tokens, is inevitable. Which companies are deployed, how and why will be monitored and discussed. Just as Delhi has shaped Non-Alignment 2.0 in its global relations, its diplomacy must avoid tying itself, and by extension the national interest, less than opaquely to the fortunes of a single private entity. Given the concentration of capital in India Inc and the economic headwinds ahead, this will be a challenge.
