Hindenburg Research, an American investment firm, on Sunday hit back at the Adani Group saying it was stoking a nationalistic narrative to draw the focus away from allegations of illicit financial activities the former had raised against the business conglomerate.

While Hindenburg’s allegations against the Adani Group are of financial corruption, the conglomerate has invoked nationalism as a response. As part of this strategy, Adani has argued that the allegations of corporate malfeasance against it are an attack on India itself. This strategy has found the backing of some people generally seen to be close to the ruling Bharatiya Janata Party.

Adani invokes nationalism

On January 24, Hindenburg Research made wide-ranging allegations that the Adani Group was pulling off the “largest con in corporate history”. It claimed that the conglomerate has over the decades been involved in stock manipulation, accounting fraud, used offshore shells for money laundering and siphoned money from listed companies.

A day after the report’s publication, Adani Group’s chief financial officer Jugeshinder Singh pushed back against Hindenburg’s allegations in a video statement with the Indian flag in the background.

In another statement on Thursday, the Adani Group had framed the Hindenburg report as having harmed Indians. “The volatility in Indian stock markets created by the report is of great concern and has led to unwanted anguish for Indian citizens,” the group said.

On Sunday, in a 413-page response to these allegations of illicit financial activities, the Adani Group instead argued that it was involved in “nation building” and suggested that Hindenburg was deliberately targeting India. “This is not merely an unwarranted attack on any specific company but a calculated attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India,” the Adani response read.

Logo of the Adani Group outside its office building in Ahmedabad. Credit: Amit Dave/Reuters
Logo of the Adani Group outside its office building in Ahmedabad. Credit: Amit Dave/Reuters

The group went on to allege that Hindenburg had shown “contempt for the Indian institutions including the regulators and the judiciary”.

In an interview to Mint published on Monday, Singh compared the American investor to General Dyer, the British army officer responsible for a massacre of Indians in 1919 in Amritsar. “In Jallianwala Bagh, only one Englishman gave an order, and Indians fired on other Indians,” Singh said as he expressed disappointment that the stock market was reacting to allegations of malfeasance. “So, am I surprised by the behaviour of some fellow Indians? No.”

Singh added, “A white person gave an order that some Indians should fire is a possibility. It happened in my state [Punjab], and we memorialise that day.”

Draped itself in the flag

The Adani Group also said that the intention of the Hindenburg report had been called into question because it was published just ahead of Adani Enterprises, the group’s flagship company, undertaking India’s “the largest ever” follow-on public offering – the process of a listed company issuing new shares to its investors or existing shareholders.

In a rebuttal to Adani Group, Hindenburg said the conglomerate was equating itself with India. “[We] believe India’s future is being held back by the Adani Group, which has draped itself in the Indian flag while systematically looting the nation,” the firm said on Monday.

Backing from those close to the BJP

The Adani Group’s invocation of nationalism has found backing from some people close to the BJP. The alleged close ties between the BJP and the Adani Group have been highlighted for some time now.

The former chief economic adviser to the Modi government, Krishnamurthy Subramanian, defended Adani against allegations that its auditing standards were weak. “Satyam [and] Enron had a big 4 auditor!” Subramanian, now appointed as the Executive Director (India) at the International Monetary Fund by the Modi government, tweeted on Sunday. “Research in accounting shows that accounting frauds are as likely with Big 4 auditors as other auditors.”

The “Big Four” refers to the four largest global accounting firms.

Geetha Kothapalli, a former member of parliament from the BJP, went a step further to describe the report as “aggression” against India. “It is quite evident, conspiracy hacked against India to destabilise our nation economically and politically,” Kothapalli tweeted. “Let’s raise our voice against such aggression. Gautam Adani is just not a person/group but our pride.”

One Twitter user suggested that Indians should help Adani monetarily. “Every Indian who can afford to let go Rs 5,000 I think should invest in shares of Indian Business houses that’s under attack by vested interests,” Varun Singh, columnist at right-wing news magazine Swarajya, said in a tweet. “We need to stand with Indian business’ who in spite of propelling India’s growth are continuously attacked.”

Similarly, a social media user urged others to stay invested amid what they termed as attempts by “anti-India forces to destabilise [the country’s] growth”.

Adani’s alleged links to the BJP have been the subject of journalism and academic inquiry ever since the group’s meteoric rise in the Modi era. “This [Adani’s stock market crash] is a shocking blow to a business that is synonymous with the success story trumpeted by Delhi and the BJP leadership,” Adam Tooze, an academic at Columbia University, wrote on Friday.