Modi govt hasn’t intervened in Adani crisis, says PM's economic advisor

The administration of Prime Minister Narendra Modi hasn’t intervened in the Adani Group’s tussle with a US short seller that caused a rout in the company’s shares, said Sanjeev Sanyal, an economic adviser to the PM.

The “government has not intervened anywhere,” Sanyal, a member of prime minister’s economic advisory council, said in an interview in New York. “Nobody’s having to rescue anyone in our system.”

Exposures to Adani group companies from the State Bank of India (SBI), the country’s largest financier and the Life Insurance Corp. (LIC), the country’s biggest life insurer, are very small, said Sanyal, adding that no company is under any financial stress.

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Shares in Adani group comapanies slumped following Hindenburg Research’s Jan. 24 report alleging fraud and market manipulation. The group, controlled by one of Asia’s richest businessmen, Gautam Adani, has denied the allegations. The selloff wiped more than $100 billion off the conglomerate’s market value.

Life Insurance Corp. has a debt exposure of Rs 6,180 cr ($755 million) to Adani Group companies, while State Bank of India, the nation’s top lender by assets, has an exposure of about Rs 27,000 crore, according to earlier statements.

“Our job is to make sure the markets are transparent and liquid and function — not for us to intervene,” said Sanyal. “Transparency and orderly market movement is the only thing we care about. If that is maintained, the prices will sometimes go up, sometimes they’ll come down.”

Sanyal said the recent collapse of Silicon Valley Bank, won’t have any first-order impact on India’s startups.