In a significant relief for the Adani Group, US President Donald Trump has paused enforcement of a bribery law that was used by the Joe Biden administration to indict them in 2024. The 1977 Foreign Corrupt Practices Act (FCPA) prohibits American and foreign companies from bribing officials serving in foreign governments for business purposes, and it has been suspended for future use after Trump signed an order to this effect.
Last year, the Adani group came under attack after this law was used by the US Department of Justice to indict the Indian conglomerate over allegations of misconduct.
Adani Group’s Previous Indictment
As per the American authorities, the Adani group had paid a bribe of $265 million to secure solar energy contracts in India that were expected to yield $2 billion in profits. The allegations were against Adani Green Energy Limited and Azure Power Global Limited. Although the bribery in question was allegedly given for business dealings in India, the Adani group had raised money for the projects from American markets, which the US government used as a pretext to extend its jurisdiction and prosecute the Indian corporate group.
Interestingly, this was seen as an overreaction by the Joe Biden administration, which also had a shaky record when treating an important strategic geopolitical partner like India. Many in the country had at that time accused the Biden government of overreaching as the said activity took place within India’s jurisdiction, and the best course of action for the US government was to flag it for the Indian authorities. However, the Biden administration not only initiated criminal indictment against the Adani Group but even the US Security and Exchanges Commission (SEC) also charged Gautam Adani, his business associates Sagar Adani and Cyril Cabanes for running a massive bribery scheme in India.
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Congressmen’s Response to DOJ’s Actions
In a sharp turn of events under President Donald Trump, US Congressmen have written to the new Attorney General Pam Bondi, calling the previous Department of Justice’s action a ‘misguided crusade’. As per the strongly worded letter, this action was not only ‘unwise’ but also came at the significant risk of jeopardising the United States’ relations with an important strategic and economic partner like India. They also alluded to the role played by Adani Group and many other companies in contributing to the American economy by creating jobs or through investments. They also mentioned that such indictment of Indian companies would backfire in the form of strengthening adversaries like China, whose Belt & Road initiative is a big challenge anyway.
Implications for U.S.-India Relations
The letter sent by the six congressmen to the Department of Justice also mentioned the mutual bonhomie and shared vision between President Trump and Indian Prime Minister Narendra Modi. It may be safely concluded that the Trump government’s decision to put the 1977 law on hold, which was used for the criminal indictment of Adani and his associates, may directly relate to how the new government wants to steer its relations with India. Adani Group is a multi-billion dollar Indian conglomerate with business interests worldwide. Some of its projects are strategically very significant for India, so the group is under attack every now and then from the country’s adversaries, such as China.
However, the United States and India share a mutually beneficial relationship in the emerging security architecture of the Indo-Pacific, and this may be why Trump took no time to reverse the blunder committed by the Biden administration.
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