Adani Group Plots Expansion Of Overseas Port Empire After US Funding

Adani Group Plots Expansion Of Overseas Port Empire After US Funding

• By Staff Writer

Standing before Sri Lankan officials and US diplomats in Colombo hotel last week, Karan Adani said that a newly inked $553 million US government financing deal toward a port terminal being developed by his family's conglomerate was a "reaffirmation by the international community."

The announcement marked a welcome reprieve for Adani Group following a damaging short-seller attack and a number of corporate fraud allegations leveled against it this year. It also signaled Washington's endorsement for the port empire owned by Karan's father and billionaire Gautam Adani that would help curb China's maritime influence in the Indian ocean.

Those waters account for more than one-third of the world's bulk cargo traffic and two-thirds of oil shipments. Chakri Lokapriya, chief investment officer at TCG Asset Management Co. in Mumbai, called Adani's port ambitions a "strategic" play, assisting India to counter China's own string of ports in its backyard, stretching from Sri Lanka to Pakistan.

Now Adani Ports and Special Economic Zone Ltd., seen as the conglomerate's crown jewel, is eyeing further "opportunities in our neighboring countries," Karan Adani, the operator's chief executive officer, told Bloomberg News in the Sri Lankan capital. Those include potential ventures in Bangladesh, as well as East African and Southeast Asian nations, including Tanzania and Vietnam, adding to its existing Sri Lanka and Israel developments, he said.

In a world that's "looking beyond China - it is indeed a Chinese-styled expansion by Adani," said Sanjiv Bhasin, director at Mumbai-based IIFL Securities Ltd.

The US funding for the Adani-led West Container Terminal in Colombo via the Intentional Development Finance Corp. was a shot-in-the-arm after a torrid few years for the Adani Group's overseas expansion efforts.

The conglomerate pulled the plug on its plans to build a port in Myanmar following a military coup. Last year, Adani faced protests and political criticism in Sri Lanka, which characterized the firm's port and energy proposals as opaque projects pushed onto the country by New Delhi.