Several Opposition leaders, including former Congress chief Rahul Gandhi, on March 15 attacked the government over a media report claiming that a key Adani Group investor is also co-owner with the conglomerate in a defence firm.
Mr. Gandhi asked why India's national security is being "compromised" by giving control of strategic defence equipment to unknown foreign entities.
The Congress also posed a set of questions to Prime Minister Narendra Modi, asking why he was "sacrificing India’s national security interests for the financial interests" of cronies.
A report in The Indian Express claimed that ELARA India Opportunities Fund (Elara IOF), a venture capital fund managed by Elara Capital, is one of the top four entities registered in Mauritius that holds shares predominantly in Adani Group companies. According to the report, records show that along with the Adani Group, it is a promoter entity in a defence company, Bengaluru-based Alpha Design Technologies Private Limited.
This defence company, incorporated in 2003, works closely with ISRO and DRDO and has a ₹590 crore contract with the Union Ministry of Defence in 2020 to upgrade and digitise the ageing Pechora missile and radar systems, the report said.
Trinamool Congress MP Mahua Moitra shared screenshots of the report on Twitter.
"The 'Chhupa Rustom' category award at the Oscars goes to @DRDO_India and @PIBHomeAffairs. Happy to have unknown foreign funds controlling sensitive defense contracts! Only for their best friend Mr Adani," she said.
Citing the same media report, Shiv Sena (Uddhav Thackeray) MP Priyanka Chaturvedi said on Twitter, "This is in India's Defence space, a key investor in Adani Group, Mauritius based Elara IOF, with 96% of its corpus invested in the group till Dec, '22 is also co-owner in a Defence company, the firm works closely with ISRO & DRDO, both jointly hold over 51% stake. Amazing coincidence!" Several Congress leaders spoke out on the matter with Mr. Gandhi too sharing a screenshot of the report.
"India's missile and radar upgrade contract is given to a company owned by Adani and a dubious foreign entity called Elara. Who controls Elara? Why is India's national security being compromised by giving control of strategic defence equipment to unknown foreign entities?" he asked on tweet.
Congress general secretary Priyanka Gandhi Vadra also hit out at the government over the media report in a tweet in Hindi.
"A leading newspaper of the country has revealed the co-ownership of a dubious Mauritius-based company with a firm of Adani Group. This firm of Adani Group has important contracts in ISRO-DRDO and the defense sector," Priyanka Gandhi said in a tweet in Hindi.
"But the prime minister neither wants a discussion on this in Parliament, nor any investigation. Why?" she said.
Her colleague, party general secretary Jairam Ramesh, posed a set of three questions to Adani. A news report, he said, shows that the Mauritius-based Elara India Opportunities Fund is the co-owner of the Bengaluru-based defence firm Alpha Design Technologies. While Adani Defence Systems and Technologies owns a 26 per cent stake, the Elara fund owns 25.65% directly and via an intermediary firm, he claimed.
As of December 2022, he said, the Elara India Opportunities Fund held ₹24,600 crore of equity, of which an "unusually high 99 percent" — amounting to ₹24,335 crore — was invested in Adani Enterprises, Adani Transmission and Adani Total Gas. Alpha Design builds electronic warfare systems, radars, optronics and communications networks for the Indian Armed Forces and ISRO.
"Should an opaque offshore fund, whose ultimate beneficial owners are unknown, be permitted to own a major stake in a sensitive defence firm? If the fund is, as accused, a stock parking entity for Vinod Adani and his associates, should the government not demand total transparency about the origins of its funds?," Mr. Ramesh asked as part of the 'HAHK' (Hum Adani ke Hain Kaun) series.
Alleging that Elara has an association with alleged stock manipulator Ketan Parekh, the Congress leader asked, "With this record of involvement in nefarious stock market activities, how did Elara get clearance to invest in a firm like Alpha Design Technologies?" "Are you sacrificing India’s national security interests for the financial interests of your cronies." Opposition parties have been persistent in their attack on the government. It comes weeks after Adani Group stocks took a beating on the bourses in the wake of US-based short seller Hindenburg Research making a litany of allegations, including fraudulent transactions and share-price manipulation, on the conglomerate.
The Adani Group has dismissed the charges as lies, saying it complies with all laws and disclosure requirements.