New Delhi
The turmoil caused by US’s indictment of billionaire Gautam Adani in an alleged million dollar bribery case is unlikely to shake the faith of global investors in India, but would make it difficult for the Adani Group to get access for growth capital from international markets, says real estate doyen and business tycoon, KP Singh, the Chairman Emeritus of DLF Ltd.
According to Singh, this time the allegations have been levied by Federal prosecutors and it is for the self-made businessman (Adani) to prove his innocence.
Federal prosecutors have accused Adani and some top executives of his Group of orchestrating a $250 million bribery scheme in India which was subsequently concealed at the time of him raising money in the US. The Adani Group has already denied these allegations as “baseless”.
“In the US, the system works a bit differently. Their indictment is a phase of the judicial system in which they do thorough investigation with all data and checks. Then they say, the case is fit to be brought before the Court for indictment. Which means they start the process again.... it is up to them (Adani) now to prove that they are not wrong,” Singh told businessline adding that: “...effect in stock exchanges (there) could be a temporary deficit (drop in share price)....But I think, till this matter is cleared, there could be some difficulty (for Adani) in accessing international capital for growth.” .
Singh, however, admits, the indictment and subsequent controversy is “unfortunate”, and businesses and other entities of Adani are doing well and “are profitable”. “So you can’t say that the enterprises or entities are wrong,” the 95-year-old said.
The real estate doyen says he has “not paid a single penny as bribe” to get work done. It has been a part of his ethics and morality to never pay a bribe and he has avoided the “greedy builder mentality”. Rather he had always pursued his cases patiently with bureaucrats and powers-that-be; explained “the greater good” and how his proposition would benefit people.
According to him, this indictment will not impact Indian businesses. In fact, most entrepreneurs in the country are already very clear on their ethics and morality now. Businesses are also compliant.
“...whether it (Adani’s indictment) is going to affect the overall business, I do not think so. Because, if you see the history of India, every time some names have emerged to rock the boat,” Singh said.
Praise for Modi’s leadership
“It is a fallacy to think that India is not a major economic power,” he says adding that a “strong leadership” - of Prime Minister Narendra Modi and his selection of the Cabinet – remain the corner-stone of global investor interest in India.
Under Modi, the environment of development has undergone a sea-change as compared to previous years. He sees digitalising of the economy as a positive step and says he supports the demonetisation step since it made people adopt digital payments and brought more people into the tax ambit. “The increasing GST numbers are proof of that,” Singh says.
“Prime Minister Modi has assembled a good team of Ministers who are very bright people...He has not gone run of the mill. Take the Foreign Minister, he is one of the best. You take the Rail Minister, what a bright man. Take the Finance Minister, she is very competent...Tax collections are up, people are compliant, bank penetration in rural areas are up.... it is not a mean feat,” he says.
He also has faith in the new age entrepreneurs and a young demographic – average age of India being 29 years as compared to ageing societies of China and Europe to take the country forward.
“So all in all, India is already, in my view, a developed economy now,” Singh said.