The Modi government is lucky. The latest bombshell from Hindenburg Research landed in India a day after the budget session of parliament had concluded. Had it come a couple of days earlier, one can just imagine the scenes in both houses of parliament, given that the name “Adani”, mentioned by anyone in the opposition, is like a red rag for this government.
It will be recalled that we first heard about US-based Hindenburg Research when it broke a major story in January 2023 about the Adani group of companies. It claimed that after two years of research it had evidence to show that “Indian conglomerate Adani Group has engaged in a brazen stock manipulation and accounting fraud scheme over the course of decades”. The expose shook up the financial markets in India and it is estimated that the Adani Group lost $150 billion.
In the weeks that followed these sensational revelations, in response to a petition, the Supreme Court asked the Securities and Exchange Board of India (SEBI) to investigate the veracity of the accusations made in the Hindenburg report. More than a year later, the investigation has still not been completed despite the court setting a deadline for March 2024.
It is against this background that the latest report by Hindenburg, made public on August 10 must be viewed. The group has raised serious questions about the current chairperson of SEBI, Madhabi Puri Buch, and suggested the possibility of a conflict of interest in relation to the ongoing investigation into the Adani affair.
How has the Indian media covered this latest development?
The story is not straightforward. To independently verify the Hindenburg revelations would require media houses to invest time and money to investigate each accusation and ascertain whether there was any truth in them.
It is still early days and perhaps some media house will walk that distance.
However, so far, the English print media, including the business papers, have stuck to reporting the gist of the Hindenburg revelations. Some gave it prominence on the first day, that is August 11. Others buried the story on the inside pages. For instance, while Indian Express and Times of India, as well as Telegraph, ran the story prominently on their front pages, The Hindu and Hindustan Times buried it on an inside page.
In subsequent days, Indian Express has been the most active in following the story, continuing to give it a prominent position on its front pages, and doing a detailed explainer. Some of the business papers have also done explainers. These are essential for lay readers who would not understand the intricacies of the financial world.
The SEBI chairperson, and her husband Dhaval Buch, who has also been named by Hindenburg, issued a detailed statement that was carried by all media. SEBI issued a statement clearing the chairperson. And the press also reported the government’s response which was that it had nothing more to add to SEBI’s statement.
However, even as all these statements were reported without any questions being asked, a couple of newspapers did raise some tentative doubts.
For instance, both Hindustan Times and Mint, which belong to the same group, suggested in their editorials that in the “public interest” perhaps the Adani matter should be “taken over by sleuths other than Sebi’s”. They did not, however, suggest that the chairperson should step down.
The Financial Express did just that. In its editorial on August 12, it wrote: “Given the latest round of serious allegations before, it will be in the interest of India’s financial markets, the regulator, and Buch herself that the Supreme Court sets up a separate panel to take over the investigations into the Adani fiasco. Till the panel report is out, the Sebi chairman should recuse herself from this case. Such an action will only enhance the reputation and integrity of the country’s capital markets.”
On August 14, The Hindu also called for the SEBI chairperson to step down in its editorial.
Much of the rest of the coverage consisted of what the media like to call the “slugfest” between the opposition, which is demanding a JPC inquiry and the resignation of the SEBI chairperson, and the BJP which suspects that the controversy has been deliberately created to undermine India’s image. The loquacious Ravi Shankar Prasad led the way by typically bringing in the BJP’s favourite whipping horse, American philanthropist George Soros.
The serious questions being asked, and the first tentative investigations, have appeared in independent media platforms. Sucheta Dalal, whose expose of the stock market scam in 1992 still stands out as one of the best investigative stories done by a business journalist, asks tough questions in this piece in Moneylife
She asks, for instance: “SEBI’s response, issued late on a Sunday night, is particularly disappointing. It claims to address issues that ‘warrant an appropriate response.’ However, when serious allegations are made against the chairperson and the regulator itself, an ‘appropriate response’ cannot be anonymous. It should come from those in a position to speak for the regulator – which is either the board of directors or the finance ministry. Was there a board meeting? Who has assumed responsibility for statements made in the press release?”
These are questions that other media organisations should also have asked but did not.
Both Scroll and Wire have done reports checking the veracity of some of the statements made by the SEBI chairperson in response to the Hindenburg report. So even if parliament is not in session, and the opposition is unable to maintain a head of steam on this controversy, questions about conflict of interest in SEBI, the veracity of the Hindenburg revelations last year and now, and the health of our regulatory agencies will continue to be asked.
Moving away from financial markets that interest a small percentage of Indian citizens, there is other dirt that is waiting for the media to dig up, literally. And that is on the state of India’s major cities.
In this rainy season, almost every major city is drowning, their drains or what passes off for a drainage system, unable to cope with excess rains. Our cities are neither “smart”, as the Modi government promised, nor anywhere near a “global” standard despite the fancy airports, that also leak, and so-called “world class” highways that become moonscapes of potholes after a heavy downpour.
While we write about urban infrastructure above the ground, stories that are often just refurbished press releases, the media needs to take a closer look at what lies beneath the city.
On July 27, after three young people drowned in a basement in Delhi, the question of drainage systems appeared on the horizon momentarily. These three were not doing anything risky. They were sitting in a studying room, in one of the many centres that prepare those trying for competitive exams to enter the civil service, or to get into engineering or medical colleges. When the skies opened, and the drains overflowed, the basement flooded and these three drowned. It was a tragedy that ought to be a wakeup call not just for city planners and administrators, but for the media.
Unfortunately, civic reporting has been downgraded to stories on such disasters. What we need are “drain inspectors”, journalists who understand the crucial infrastructure needed to make cities liveable for all and to persist in asking questions and reporting before disaster strikes.
There was a time in Mumbai, where the acronym BRIMSTOWAD, which stood for Brihanmumbai Storm Water Disposal System, appeared regularly in the city papers. We read stories about the city’s 100-year-old drainage system and the urgent need for investment to repair and add to it so that the perennial monsoon flooding was avoided. Such reporting has virtually vanished.
In the meantime, most of our cities continue to depend on ancient drainage systems and see little to no investment in making this “world class” even as densities increase, open areas are paved to prevent the natural absorption of excess rain, and the roads are in permanent gridlock.
What is worse, despite all the talk about becoming a developed country, almost every day there are sickening stories of men who are lowered to clean these drains manually and die as they inhale the noxious fumes trapped inside – stories like this one in Scroll. India must be one of the few countries in the world that aspires to conquer space but cannot invent machines to replace people for such hazardous but essential work.
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