Adani is in trouble, again?
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In today’s edition of The Daily Brief:
Why is Adani in trouble?
Is the government not spending on health?
Why is Adani in trouble?
The Adani Group, one of India’s biggest and most well-known conglomerates, is facing controversy again. This time, the U.S. Department of Justice (DOJ) is raising questions. They’re accusing top Adani executives—including Mr. Gautam Adani himself—of bribery, fraud, and obstructing justice.
If these claims turn out to be true, it could seriously impact investor confidence and even harm India’s renewable energy goals. Of course, these are still just allegations, and the legal process could take years to unfold. But it’s important to understand what’s happening. So, let’s break it down step by step.
Here are the three main accusations from the DOJ:
The DOJ claims that between 2020 and 2024, Adani executives paid over $250 million in bribes to win solar energy contracts. These contracts were tendered by the Solar Energy Corporation of India (SECI), a government agency leading the National Solar Mission. These projects promised huge profits—up to $2 billion over the next 20 years.
Adani Green Energy relied a lot on international funding, raising over $3 billion through loans and bonds. To attract foreign investors, they claimed to follow strict anti-corruption policies. But according to the DOJ, this was just a front. While projecting an ethical image, they were allegedly hiding their bribery activities. The DOJ says this false image led investors to trust them and put in their money under misleading terms.
When U.S. authorities started investigating, the DOJ alleges that Adani’s top executives took steps to block the process. This reportedly included deleting records, providing false information, and holding back important evidence.
At the center of the controversy is a massive solar energy project that was tendered by SECI. At the time, it was the largest in the world. The project started as a 2 GW (gigawatt) plan but later expanded to an ambitious 12 GW. Two companies, Adani Green and Azure Power Global, won the tender, with Adani Green receiving the larger share.
Under the tender's terms, both companies were responsible for building and operating large solar farms. In return, SECI would buy the power from them and sell it to state-run power distribution companies (DISCOMs).
The trouble began when DISCOMs refused to pay SECI the rate it had agreed to for purchasing power from these projects. This caused a major bottleneck, as SECI couldn’t close its end of the deal. As a result, SECI started delaying the signing of contracts with Adani Green and Azure. Although these contracts were supposed to be finalized within 90 days of the tender, 18 months went by, and there was still no agreement.
To save the project from collapsing, the DOJ claims that executives from the Adani Group paid bribes to officials in various state governments. These bribes were allegedly paid for their benefit and on behalf of Azure Power. The goal was to convince DISCOMs to sign agreements with SECI. Once the DISCOMs were on board, SECI could finally sign Power Purchase Agreements (PPAs) with Adani Green and Azure. This move, according to the allegations, kept the project alive.
However, this led to another issue. Azure Power allegedly owed $83 million for the bribes that were paid on their behalf. When Azure refused to pay their share, the companies reportedly worked out a non-cash arrangement. Azure allegedly transferred its most profitable contract—one for 2.3 GW—to Adani Green to settle the matter.
But that raises an obvious question—if this is an Indian company dealing with Indian officials, why is the U.S. stepping in and taking action?
Here’s the thing: the DOJ’s main case isn’t actually about corruption charges against Adani executives. It’s focused on Azure’s officials.
The case against Adani executives is primarily about securities fraud. Here’s how: Adani Green raised $2 billion through USD loans and another $1 billion in bonds from American investors and financial institutions. Before raising that kind of money, companies have to make certain disclosures, provide accurate statements, and go through thorough checks.
Adani Green, in its documents and investor calls, repeatedly claimed that it wasn’t involved in corruption and that it had strong anti-corruption systems in place. But according to the DOJ, these claims were false. They allege that while Adani Green told investors their operations were clean, the company was actually engaged in bribery.
This is the crux of the DOJ’s case: Adani Green raised money from U.S. investors under false pretenses. Since the U.S. can’t directly charge Adani for corruption that happened in India, they’re pursuing the company for lying to investors about not being corrupt.
So, with all that said, the big question is: what are the consequences?
If these allegations are proven true, the fallout could be massive. We’re talking about billions of dollars in fines, losing access to global funding, and significant damage to the Adani Group’s reputation.
On top of that, arrest warrants have reportedly been issued against Gautam Adani in New York over bribery allegations. This means he could face legal proceedings in the U.S., including the possibility of arrest, a trial, and severe penalties if found guilty.
Adani Green could also face serious reputational damage, making it harder to win new contracts or attract investors in the future.
But the impact doesn’t stop there. These allegations could spark a wave of scrutiny in India, pushing authorities to dig deeper into corruption and fraud in corporate dealings. This could go beyond the Adani Group, reshaping how similar projects are managed and governed.
In short, this isn’t just another corporate controversy—it’s a major accountability test. With U.S. authorities involved, what might have stayed a regional issue has now become a global one.
The outcomes here could influence how companies in India and other emerging markets approach governance, how investors evaluate trust, and even the future of renewable energy development worldwide.
Is the government not spending on health?
In The Daily Brief, we usually dive into business and finance. But today, we’re shifting gears to talk about something just as important: health.
Why health? Because a healthy population directly affects the economy. Healthy people work more consistently, are more productive, and contribute more. Kids who grow up healthy develop stronger cognitive skills and earn more as adults, driving long-term progress. Families also save on medical expenses, leaving more money for education, housing, or even starting a business. You get the idea.
And the data proves it: a 10% drop in malaria cases can boost economic growth by 0.3% in affected countries. Eliminating severe malnutrition in kids can increase their future earnings by over 20%. Better health doesn’t just mean better lives—it means stronger economies.
But here’s the flip side: when healthcare systems are weak, people can’t access the care they need. Many end up paying out of pocket for doctor visits, medicines, or hospital stays because there’s no insurance or government support. For families, these costs can lead to debt or even push them into poverty.
This problem is especially severe in low- and lower-middle-income countries, where most people simply can’t afford healthcare. For example, in India, individuals pay 50.6% of healthcare costs directly from their own pockets. Compare that to the U.S., where this number is just 9.9%.
Many of these countries rely on international aid or grants to help fund healthcare, but here’s the catch—those funds are unpredictable. You can’t build a solid healthcare system on money that might not be there next year.
This is why government healthcare spending is so important. It’s the backbone of healthcare systems, providing a safety net so people can get care without being financially devastated. If that spending drops, there’s no backup plan.
Today, we’re looking at the latest trends in government health spending (GHS) across low- and lower-middle-income countries. Together, these nations are home to nearly 3.4 billion people. These trends reveal how governments are prioritizing health—and what that means for their people and economies.
Trends in Government Per Capita Health Spending
Let’s start with per capita health spending—basically, how much governments spend on healthcare for each person. During the pandemic, this spending spiked as countries scrambled to respond to the crisis. But by 2023, spending had dropped significantly in many places.
In low-income countries, government health spending fell back to pre-pandemic levels—just $10 per person. For lower-middle-income countries, it dropped to $57.6 per person.
To put this into perspective, organizations like the World Health Organization (WHO) recommend a minimum of $80 per person to provide basic health services and achieve universal health coverage.
This decline becomes even more concerning when we look at the growth rates, as shown in the chart. During the pandemic in 2020, government health spending per capita grew at an incredible pace—nearly 30% in low-income countries and a significant jump in lower-middle-income countries as well.
This surge happened because governments made health systems a top priority to tackle the crisis. It was a necessary and urgent response to the challenges they faced.
However, things changed drastically after the pandemic. By 2022-2023, growth rates for health spending dropped sharply, even turning negative for low-income countries. In contrast, general government spending per capita (GGE) stayed relatively steady. This shows that while overall spending slowed down, it didn’t decline as steeply as healthcare spending.
What this tells us is that healthcare is no longer the priority it was during the crisis. Governments may be spending more overall, but healthcare is getting a smaller piece of the budget, signaling a shift in focus away from public health systems.
Trends in the Health Share of Government Spending
The share of total budgets allocated to healthcare is also shrinking. In low-income countries, this health share dropped from 6.2% in 2019 to just 5.6% in 2023.
Lower-middle-income countries saw a smaller decline, but the trend is still heading downward. In simple terms, healthcare isn’t getting the attention it used to within government budgets.
Why Is This Happening?
There are several reasons why low- and lower-middle-income countries are struggling to prioritize healthcare spending:
Financial Constraints: These countries often have limited tax revenue, which means they collect less money to fund public services like healthcare. This forces governments to make tough choices and trade-offs between competing priorities.
Rising Debt Burden: Many of these nations are heavily in debt, and repaying loans often take precedence over critical services like healthcare. Over the past decade, the share of government revenue spent on foreign debt payments has more than doubled. For most low-income countries, this figure has risen from 6% to 14%, and in some cases, it’s as high as 25%.
When such a large portion of revenue goes toward repaying creditors, there’s less money left for essential services like health, education, and infrastructure. Rising interest rates make things worse, increasing borrowing costs and putting even more pressure on public finances.
In short, debt payments are crowding out healthcare spending, making it harder for governments to invest in the well-being of their people.
What Does This Mean?
This drop in healthcare spending has serious consequences:
Struggling Health Systems: Key services like immunizations and disease control suffer. Public hospitals face funding shortages, and healthcare workers might go unpaid, putting entire health systems at risk of collapse.
Tough Choices: Governments are forced to choose between healthcare, education, infrastructure, or paying off debt. Cutting healthcare might seem like an easy fix in the short term, but it causes long-term harm to public health and economic growth.
Unreliable Aid: Many countries depend on international aid, but it’s unpredictable and cannot support a stable healthcare system.
No Public Funding, No Safety Net: Without government support, families have to pay out of pocket for care, often falling into debt or poverty. Once healthcare systems collapse, rebuilding them is far more expensive.
This isn’t just a passing trend—it’s a wake-up call. Governments need to step up and make healthcare spending a priority now. Without strong public funding, the health of millions—and the economic future of these nations—are at serious risk.
Tidbits
India's GDP growth slowed to 6.5% in Q2 FY25, hit by heavy rainfall, weak exports, and shrinking corporate margins. Manufacturing showed strength with 7% growth, but agriculture struggled, growing just 2%, highlighting the broader challenges in the economy.
NTPC is set to launch a ₹1.85 trillion green hydrogen hub in Andhra Pradesh, partnering with global companies to drive industrial decarbonization. Using renewable energy, the project aims to support industries like steel and aluminum, positioning India as a global leader in green hydrogen.
A 51% surge in imports has pushed steel prices to their lowest in four years, despite domestic consumption rising by 12%. Falling prices have squeezed margins for major players like Tata Steel and SAIL. However, hopes for a recovery in Q4 rest on restocking and growing demand from infrastructure projects.
Advent International is in talks to acquire a 51.74% stake in VIP Industries for ₹3,379 crore. With VIP’s stock down 25.7%, this deal could reshape its strategy as it faces rising competition from D2C brands and global players like Samsonite.
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Why have stories cut down to 2 from 3?
Dont understand where our health and education cess going to??