Modani Files: Adani deals put national security at risk

The investigation, carried out by Delhi-based independent journalist Ravi Nair, says that a Chinese company connected with the Adani Group is involved in building critical infrastructure in India

Hyderabad: When it comes to Adani, even Atmanirbhar Bharat takes a backseat. Or that is what a recent investigation by AdaniWatch, a non-profit project established by the Bob Brown Foundation ‘to shine a light on the Adani Group’s misdeeds’, reveals.

The investigation, carried out by Delhi-based independent journalist Ravi Nair and edited by veteran journalist Paranjoy Guha Thakurta, says that a Chinese company connected with the Adani Group is involved in building critical infrastructure in India.

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“The firm, PMC Projects (India) Private Limited, has been developing seaports, container terminals, airstrips, electricity transmission lines and railway tracks, among other public utilities. It operates from premises owned by Adani Enterprises, the flagship of the Adani Group, but is owned by Chang Chien-Ting (also known as Morris Chang), son of Chang Chung-Ling, who has been a director of many Adani companies over the years and is said to be a business associate of the ‘elusive’ Vinod Adani,” the AdaniWatch report says.

The involvement of a Chinese-owned company in the establishment of critical infrastructure in India raises questions about national security, it notes, and goes on to say that even the Directorate of Revenue Intelligence had leveled charges against companies that were part of the Adani Group.

“The companies concerned have been accused of ‘over-invoicing’, a practice in which goods are routed through an intermediary that artificially inflates the price in order to create an improper advantage for the main company concerned. The alleged over-invoicing of imported equipment was said to have been undertaken by three companies: Adani Power Maharashtra Limited (APML), Adani Power Rajasthan Limited (APRL) and Maharashtra Eastern Grid Power Transmission Company Limited (MEGPTCL),” it says in a show-cause notice sent to various Adani Group companies and to Vinod Adani.

The DRI says in the notice that an entity named Electrogen Infra FZE (EIF), registered in the United Arab Emirates and controlled by Vinod Adani, acted as an intermediary invoicing agent for PMC Projects (India) Private Limited (PMC) and MEGPTCL while importing machinery for installing electricity transmission lines. EIF had inflated the amounts shown in invoices to PMC and MEGPTCL by up to 400 percent.

Back to the PMC. The firm was incorporated on May 3, 2005 in Ahmedabad as a 100 percent subsidiary of Project Monitoring and Construction Limited (PM&CL), a private company registered in Mauritius. PM&CL held 9999 shares in PMC, while Malay Mahadevia held a single share. A dentist by profession, Mahadevia, the first director of PMC, is known to be close friend and professional associate of Gautam Adani. He has been associated with the Adani Group from the early 1990s, the report says.

Though the Adani Group never described PMC as a ‘group company’, PMC’s connection with the group was clear from its inception, the report alleges, adding that the registered email address of PMC used a domain name of the Adani Group in the company’s annual returns between 2006 and 2012.

The official website of PMC Projects (India) Private Limited is not operational now, but its archives say ‘PMC Projects have worked closely with developers and has developed India’s largest private port as a project management consultant from concept to construction to management at Mundra, Gujarat.’

According to the AdaniWatch report, it also says the company has also carried out significant work in operating ports at Dahej, and Hazira in India.

“PMC Projects is also in the process of developing berths at major ports located at Kandla in Gujarat, Mormugao in Goa and Visakhapatnam in Andhra Pradesh. PMC Projects is also providing Project Management Consulting services for the overseas projects such as coal terminal expansion at Abbot Point, Australia, Carmichael Coal Mine Project and North Galilee Basin Rail Project (NGBR Project,” it says.

Each of the above projects obviously is linked to Adani.

Now to the Chinese connection. The report says that on February 8, 2019, the Government of India amended a section in the Companies Act 2013 and made it mandatory for companies to disclose the names of the entity’s ‘significant beneficial owners’. This obliged PMC Infra Ltd to disclose the name of its beneficial owner. On September 28, 2020, Chang Chien-Ting (also known as Morris Chang) declared that he was the 100 percent beneficial owner of PMC Projects (India) Ltd through the Mauritius-registered PMC Infra Ltd. Chien-Ting is the son of Chang Chung-Ling, who was a director of several Adani Group companies, and whose name has appeared in connection with the coal-procurement investigation, with the disclosure form identifying Chien-Ting as a citizen of China.