Adani Group is facing growing pressure to reveal which company in its complex corporate web has applied for a $1 billion subsided loan from the Australian Government, amid fears money could be shifted to a tax haven and investors may have been misled.
An Australian law firm has written to the Bombay Stock Exchange asking it to clear up the confusion about a $1 billion funding application to the Federal Government's Northern Australia Infrastructure Facility (NAIF).
The loan would finance a 400-kilometre railway from Queensland's Abbot Point Coal Terminal to a planned massive mine in the Galilee Basin, which, if it goes ahead as proposed, would contain six open-cut pits and five underground collieries.
It is absolutely possible investors have been misled about the loan, lawyer David Barnden from not-for-profit law firm Environmental Justice Australia (EJA) told the ABC.
In terms of misleading the market, the NAIF funding is really, really important for Adani's share price, Mr Barnden explained.
When [Resources Minister] Matt Canavan told Reuters last week that Adani Enterprises had applied for the funding, the share price went up 4 per cent.
The surge in the stock price came after a report, based on an interview with the Resources Minister, that the Bombay Stock Exchange-listed company had applied for the $1 billion loan.
In fact, the proponent of the rail project is an Australian shell company ultimately owned by Atultya Resources, an Adani family-controlled entity registered in the secretive Cayman Islands.
Last December, Adani issued a statement to the Bombay Stock Exchange which said the rail project is not part of the Adani Enterprises Ltd group.
The Cayman Islands-controlled rail company has rights to a royalty stream worth up to $3 billion from the proposed mine, the ABC recently revealed — a payment that would come at the expense of shareholders in the publicly listed Adani Enterprises.
The NAIF has refused repeated requests from the ABC for information about which Adani entity has applied for the funding.
Each request has received this standard form response:
NAIF has an independent board whose members are committed to meeting NAIF's obligations to maintain the confidentiality of its dealings. It will also comply with its statutory obligations in relation to the organisation's public reporting requirements.
The NAIF also dismissed a freedom of information application from EJA on behalf of clients seeking the name and business identification number of the Adani vehicle applying for the loan, on the grounds it would be against the public interest to release the information.
We think there is a huge public interest in the NAIF revealing which Adani entity has applied for the loan, Mr Barnden said.
Taxpayers need to know where their money is going.
Adani Group did not respond to questions about which Adani company has applied to NAIF for the loan.
By Stephen Long
EJA's letter to the Bombay Stock Exchange (PDF, 288KB)
EJA's Adani Brief (PDF, 1.53MB)
Overview of the Adani Brief (PDF, 160KB)