Welcome to Foreign Policy’s South Asia Brief.
The highlights this week: India’s renewable energy sector will feel the impact of billionaire Gautam Adani’s indictment in the United States, thousands of supporters of former Pakistani Prime Minister Imran Khan take to the streets, and a Bangladeshi Hindu activist is detained on sedition charges.
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The Ripple Effects of Adani’s Indictment
Indian billionaire Gautam Adani’s criminal indictment in the United States last week, which charges him in connection with a massive bribery scheme, triggered shock waves across India’s economy. The renewable energy sector will feel the impact: The indictment targeted the Adani Green Energy company, which is a dominant player in the space. (Gautam Adani denies the charges in the indictment.)
Green energy is a fast-growing sector in India as Prime Minister Narendra Modi takes major steps to accelerate the country’s energy transition. Adani’s legal woes could curtail his clean energy investments—but the sector itself, with its increasingly crowded and dynamic market, should ultimately have little trouble rebounding.
Days before news of the indictment broke, Sagar Adani—Gautam Adani’s nephew and the executive director of Adani Green—announced that the parent Adani Group would invest $35 billion in clean energy projects over the next five years. Earlier this year, Adani Green’s disclosed that it would allocate $27.6 billion to expand green energy production through 2030.
Adani Green, which calls itself “India’s largest” renewable energy company, plans to more than quadruple its operating portfolio by 2030. Its investments include a renewable energy park in Gujarat and a joint wind and solar energy venture with French giant TotalEnergies. Gautam Adani is also exploring clean energy investments abroad, including a potential collaboration with Bhutan.
Unsurprisingly, Adani Green has performed well financially; data released last month shows 20 percent year-over-year increases in both energy sales and revenue growth. It is no coincidence that this expansion is happening as Modi prioritizes reducing India’s carbon emissions; Adani’s links to Modi are well known, and his business portfolio has often dovetailed with the prime minister’s policy priorities.
At the 2021 United Nations climate summit in Glasgow, Scotland, Modi pledged to make India’s emissions net zero by 2070. India’s Ministry of Power has since announced that it will accept bids for 50 gigawatts of clean energy capacity annually over the next five years.
India has committed billions of dollars in assistance to state-owned hydrocarbon firms to support their energy transitions. It has also offered generous subsidies to companies to produce solar power and green hydrogen. The government plans to reach 500 gigawatts of renewable energy capacity by 2030; the current figure is around 200 gigawatts.
However, India’s energy transition won’t be easy, in large part because of its heavy reliance on coal. This is why Gautam Adani’s large-scale investments are so important. But Adani Green’s legal troubles could slow the company down. TotalEnergies has already announced that it won’t make any “new financial contribution” to current investments in Adani companies, and that it plans to pause its partnership with Adani Green until there is more clarity about the charges.
If Adani Green does slow down, it would leave a vacuum. But given the strength of India’s clean energy sector, it is likely to be filled rapidly by corporations with large clean energy portfolios, such as Reliance and Tata; by foreign investors taking advantage of new opportunities; and by state-owned energy firms.
On Friday, Modi will lay the foundation stone for what is billed as India’s biggest green hydrogen hub to date, a project of the state-owned NTPC Green Energy Limited. When construction is complete, it will take up 1,600 acres. It is located in Andhra Pradesh state—home to the Adani Green clean energy project at the center of the recent U.S. indictment, and which the state government has suggested it may suspend.
Despite his serious legal woes, Gautam Adani could bounce back—thanks to his clout, wealth, and access to power. But if Adani Green becomes a lesser player in the clean energy realm, plenty of other players will be willing and able to pick up the slack.
What We’re Following
Pro-Khan protests in Pakistan. This week, thousands of supporters of former Pakistani Prime Minister Imran Khan heeded his call to march to Islamabad to protest a government that Khan and his Pakistan Tehreek-e-Insaf (PTI) party regard as illegitimate. Most protesters, however, focused on calling for Khan’s release from jail.
Security forces cracked down on the demonstrations with tear gas and arrests; some protesters reportedly turned to violence, but most were peaceful. PTI leaders contend that dozens of peaceful protestors were killed. Other accounts, citing official sources, estimate that 17 civilians died. At this point, it is difficult to get a clear picture of the death toll.
Late Tuesday local time, PTI called off the rally because of the risks that the government crackdown posed to protesters, according to a party statement. The decision angered and confused many PTI supporters, who have accused the party’s leadership of abandoning the protesters. (Other leaders have been criticized for not participating at all.)
What stands out about the protests is the power of Khan. Despite internet restrictions, roadblocks, threats, and a court decision that banned the protests, scores of his supporters came out—which should unsettle Pakistan’s civilian and military leadership. Khan’s continued ability to mobilize allows him to keep pressure on the government; it also amplifies the contrast between him and the rest of the PTI leadership.
The outcome of the protests is also unsettling. The use of violence by both sides has intensified the bitter confrontation between the government and the opposition, which means that Pakistan’s leadership will continue to be distracted from the country’s other crises.
Hindu leader detained in Bangladesh. On Monday, a prominent Bangladeshi Hindu activist, Chinmoy Krishna Das, was arrested at the Dhaka airport. He was charged with sedition and accused of disrespecting Bangladesh by raising a saffron flag (a reference to Hinduism) over the national flag at a rally in October.
Das has called for better security for the Hindu minority in Bangladesh, which makes up about 8 percent of the population, since former Prime Minister Sheikh Hasina resigned under pressure in August. On Tuesday, a court in Chittagong denied Das bail, and hundreds of his supporters took to the streets. Local media reported that dozens of counterprotesters joined security forces in trying to scatter Das’s supporters. A Muslim lawyer was reportedly killed during the protests.
Das’s plight and the Muslim protesters who reportedly targeted his supporters will heighten concern in neighboring India about the security of Bangladesh’s Hindu community. Defenders of the interim government in Dhaka argue that the hundreds of documented attacks against Hindus since August are part of a political revenge campaign. But the sedition charge against Das will strengthen New Delhi’s assertions that Hindus are being targeted for their faith.
BJP wins in Maharashtra. India’s ruling Bharatiya Janata Party (BJP) retained control of the state government in Maharashtra, with election results released last weekend showing a massive victory for a BJP-led alliance. (The BJP failed to win in the state of Jharkhand, which also announced poll results last weekend.)
Maharashtra is politically significant: It is India’s wealthiest state and home to financial capital Mumbai. One notable storyline in the state’s election was the successful campaigning by Uttar Pradesh Chief Minister Yogi Adityanath, who is often mentioned as a possible successor to Modi as chief of the BJP. Since taking a political hit in national elections this year, Adityanath has sought to bolster his political standing.
FP’s Most Read This Week
Under the Radar
Last week’s South Asia Brief predicted that the thumping victory by the party of Sri Lankan President Anura Kumara Dissanayake in parliamentary elections this month would give him the political space to take unpopular steps—including dialing down earlier pledges to renegotiate an agreement with the International Monetary Fund (IMF) to reduce the impact of austerity measures.
In a speech to parliament last Thursday, Dissanayake indicated that he plans to do just that. He ruled out reopening negotiations and said, “[T]his is not the time to discuss if the terms are good or bad, if the agreement is favorable to us or not,” adding, “we cannot start all over again.” His choice to stand down paves the way for Sri Lanka to receive the $1.6 billion in assistance yet to be disbursed through the current IMF deal; so far, it has received $1.3 billion.
Though criticized by some observers, the decision hasn’t led to a large outcry or public protests, suggesting that it won’t be politically damaging for Dissayanake—at least not yet. In recent months, inflation in Sri Lanka has fallen and growth prospects have increased. But if the country’s economic recovery sputters and IMF-mandated austerity hits the public hard, Dissayanake’s move could come back to haunt him.
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