People’s eyes glaze over when they hear the word “infrastructure,” but there has been nothing boring about the unraveling of India’s infrastructure king, Gautam Adani. A U.S.-based short seller, Hindenburg Research, published a 106-page forensic report accusing Adani and his companies of a vast scheme of stock manipulation and fraud, using a complex system of shell companies. And poof: Within days, and despite Adani’s denial of the allegations, more than $110 billion of the companies’ market capitalization vanished, leaving Adani himself around $58 billion poorer in paper wealth. Can the plot thicken any further? It certainly can. The Adani affair could become India’s so-called Lehman moment—leading to the unraveling not only of one of India’s largest and best-connected corporate empires but of an entire nation’s ambitions to harness what will soon be the world’s largest population in an effort to realize the country’s vast economic potential.
But ironically, the Adani crisis is exactly what India needs right now to accelerate its journey. There is much complacency among the Indian elite and around the world. The country’s size, burgeoning market, youthful demographics, and politically muscular government makes India’s rise inevitable; fix its physical infrastructure, and the world will be beating down India’s door to invest in and do business with—or so the mantra goes. Poor corporate governance, crony capitalism, defanged regulators, and uncritical media are just part of the price to be paid for India’s rise. After the Adani jolt, there will inevitably be a reexamination of the India narrative, with fresh attention paid to fixing India’s system of economic and corporate governance.
