SEC Claims Gautam Adani Offered Bribe to Andhra Pradesh Officials to Secure SECI Solar Deal

Washington, 22nd November 2024: The U.S. Securities and Exchange Commission (SEC) has claimed that Gautam Adani met with Andhra Pradesh’s then-Chief Minister Jagan Mohan Reddy in August 2021 to resolve the state’s hesitation in finalizing an agreement with the Solar Energy Corporation of India (SECI). According to court filings, the meeting involved discussions of “incentives” to secure the deal.

However, Jagan Reddy’s party, which governed from 2019-2024, denied any “direct agreement” with the Adani Group.

The SEC filing suggested that during or around the meeting, Adani allegedly offered or promised a bribe to Andhra Pradesh government officials to finalize power supply agreements with SECI, though the specific bribe amount was not disclosed. However, the U.S. Justice Department’s indictment indicated that a bribe of ₹1,750 crore was allegedly offered to an unnamed Andhra Pradesh official.

Following this meeting, the state agreed to procure seven gigawatts of power from SECI, which was the largest solar power procurement by any state at the time. The SEC suggested that the bribe facilitated the agreement.

In 2020, SECI awarded tenders to Adani Group and Azure Power for the supply of 12 gigawatts of solar energy, though SECI struggled to find buyers for the power due to its high prices. U.S. investigators alleged that when SECI failed to secure buyers, Adani and Azure conspired to offer bribes to state officials. The Adani Group allegedly paid $265 million in bribes to secure contracts with state electricity distribution companies between 2021 and 2023. Other states involved included Chhattisgarh, Tamil Nadu, Odisha, and Jammu and Kashmir.

The SEC also accused Adani of falsely claiming that Adani Green Energy had a strong anti-bribery compliance program and that its senior management would not engage in bribery.

The Adani Group, however, dismissed the allegations as baseless and pledged to pursue legal action.

Jagan Reddy’s party, YSRCP, countered by stating that the Andhra Pradesh government had no direct agreement with the Adani Group. The deal in 2021 was reportedly between SECI and the state’s power distribution companies (Discoms). The party emphasized that the procurement of seven gigawatts of power was approved by the Andhra Pradesh Electricity Regulatory Commission and signed between SECI and AP Discoms in December 2021.

YSRCP argued that the agreement was beneficial for the state, securing solar power at a low rate of ₹2.49 per kWh over 25 years, offering savings of ₹3,700 crore annually.

Meanwhile, the ruling Telugu Desam Party (TDP) has refrained from commenting on the U.S. charges, stating they needed more time to review the report. TDP spokesperson Kommareddy Pattabhiram said it would take a few days before forming a conclusion.