George Soros has predicted India’s prime minister Narendra Modi will be weakened by the woes of business tycoon and close ally Gautam Adani, “opening the door” to a democratic revival in the country.
The 92-year-old billionaire philanthropist said in a speech on Thursday that Modi would “have to answer questions” from foreign investors and parliament on allegations of fraud and stock manipulation at Adani’s industrial empire, noting that Modi had been “silent” on the topic.
Adani Group has come under fierce scrutiny since US short seller Hindenburg accused the company of engaging in “brazen stock manipulation and accounting fraud” over decades.
The power-to-port conglomerate was forced to pull a $2.4bn share sale, after its stock losses mounted to more than $100bn following the report.
Adani Group has denied the claims.
Speaking at the Munich Security Conference, Soros said: “Modi and business tycoon Adani are close allies; their fate is intertwined.
“Adani Enterprises tried to raise funds in the stock market, but he failed. Adani is accused of stock manipulation and his stock collapsed like a house of cards. Modi is silent on the subject, but he will have to answer questions from foreign investors and in parliament.”
Soros, who has become a standard bearer for liberal democracy, warned that Adani’s woes will “significantly weaken Modi’s stranglehold on India’s federal government” and “open the door to push for much needed institutional reforms”.
Soros, who made his fortune as a hedge fund manager, added: “I may be naive, but I expect a democratic revival in India.”
Adani, who was the richest man in Asia until his empire’s shares tumbled, has been a longtime ally of Modi. The tycoon’s wealth has increased since the prime minister came to office in 2014.
In parliament, opposition MPs have seized on Adani’s association with Modi stretching back to the prime minister’s days as chief minister of the western state of Gujarat.
In recent parliamentary sessions, opposition members have disrupted speeches with taunting chants of Modi Adani bhai bhai (“Modi and Adani are brothers”). Some Modi opponents have raised questions over the exposure of taxpayer funds to the conglomerate through the state-owned groups that are lenders or investors.
Modi’s Bharatiya Janata party will face voters in 2024 as the prime minister seeks re-election to a third term.
The crisis engulfing the Indian group is shaping up as a test for the country’s regulators and institutions, including the media. Adani’s business portfolio stretches from ports and airports to power and renewables, and it has foreign projects in about a dozen countries ranging from Israel to Bangladesh.
Soros also said at the conference that “two systems of governance are engaged in a fight for global domination” just as “civilisation is in danger of collapsing because of the inexorable advance of climate change”.
The Hungarian-American businessman, who established the Open Society Foundations to promote democratic governance, said Modi “is no democrat”, noting that “inciting violence against Muslims was an important factor in his meteoric rise”. He added that India “buys a lot of Russian oil at a steep discount and makes a lot of money on it”.
Soros also said Turkey’s president Recep Tayyip Erdoğan “has mismanaged the Turkish economy”, while in China, president Xi Jinping’s “close association with [Russian president] Putin would hurt him”.
He added that “Xi will not remain in office for life, and while he is in office, China will not become the dominant military and political force that Xi is aiming for.”
The Adani group had no immediate comment on Soros’s remarks and a government spokesperson declined to comment.