Adani’s political fallout

The controversy surrounding the Indian conglomerate Adani Group is filtering through to politics. [View in browser]( [Bloomberg]( Indian billionaire Gautam Adani likens his conglomerate’s accounting travails to an attack on the country, creating a political element as concern rises about the outlook for a business empire that owns some of India’s key infrastructure and employs thousands. While Prime Minister Narendra Modi and his ruling party have largely been muted so far on the Adani woes, he likely has a keen interest in how it all plays out. The tycoon knows Modi well. Both hail from the western state of Gujarat and Adani defended Modi in the aftermath of the deadly religious riots there in 2002 when he was chief minister. Key reading: - [Adani Labels Fight With US Short Seller as Attack on India]( - [Indian Tycoons Bought Adani Shares Amid Short Seller Fight]( - [Modi Aims to Please All With $550 Billion India Budget]( - [‘Adani, Adani’ Heckles in Parliament Interrupt India’s Budget]( - [Who Is Adani and What Are Hindenburg’s Allegations?]( It’s no surprise that the troubles at Adani — allegations of stock manipulation and accounting fraud from New York-based investor Hindenburg Research, which the group denies, and the subsequent plunges in shares of its companies — are filtering through to politics. Adani is a big deal in India — the country’s largest port operator and manager of some of the country’s biggest airports. While his wealth is light years away from the reality for many ordinary Indians, Gautam Adani’s story of self-made success resonates. For now, the upsides to Modi maintaining his connections with Adani probably outweigh the risks. Opposition parties are playing up their ties and suggesting the business may get state support as it comes under growing financial pressure. While loud, however, the opposition is fragmented and has struggled for years to get things to stick to Modi personally. Adani calls the claims against it “a calculated attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India.” Modi is well aware of Adani’s role as a national prize, an Indian company with global reach that can be painted as too important to the economy to fail. Especially as the prime minister focuses on wooing voters ahead of elections due around mid-2024, for whom jobs are a paramount consideration. Today’s India budget spelled out that calculus, unleashing a 33% jump in capital spending on infrastructure. That’s designed to build the roads and ports that attract investment and factories and, above all, create jobs. —[Rosalind Mathieson]( Adani and Modi at the Fifth Vibrant Gujarat Global Summit in 2011. Photographer: Vijay Soneji/Mint/Getty Images [Tune into]( our Twitter Space conversation today at 8am ET/1pm London time about the fresh tensions across the Middle East, including in Israel and with Iran. And if you’re enjoying this newsletter, sign up[here](. Global Headlines Stay home | The UK is experiencing what’s expected to be its [most severe]( day of strikes for more than a decade today as industrial action closes schools and cripples Britain’s rail network, forcing office workers to stay home. As many as 475,000 union members are protesting to demand pay rises that do more to combat the country’s cost-of-living crisis. - Strikes that hit the UK economy in the final quarter of last year [shaved]( about 0.2% off economic output, according to Bloomberg Economics, putting the cost of the action at $1.9 billion. Debt debate | US House Republicans will meet today to consider their [strategy]( on the debt ceiling, hours before Speaker Kevin McCarthy and President Joe Biden discuss the issue. Biden plans to ask McCarthy for his proposal on budget cuts and other demands Republicans are seeking in exchange for raising the limit and averting a market-rattling default. Surging military production is helping keep Russian industry [going strong](, offsetting much of the damage done by international sanctions and other fallout from President Vladimir Putin’s invasion of Ukraine. 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And finally ... Russian troops will help three African nations secure a gold-rich region in the Central African Republic rife with armed rebel groups, the latest sign of Moscow’s [expanding influence]( on the continent even as the US and its allies push against the Kremlin’s footprint. A deal struck between the CAR, Chad and Sudan aims to remove groups operating along the mineral-rich borders with the two neighboring states. A woman sieves through mud to find gold at the Gam mine in the CAR. Photographer: Issouf Sanogo/AFP/Getty Images Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. You received this message because you are subscribed to Bloomberg's Bloomberg Politics newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. 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