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In a move that sparked widespread controversy, the Kenyan government recently announced a $2.047 billion deal with Adani Airport Holdings Ltd., an Indian conglomerate founded by Gautam Adani, to expand and operate the Jomo Kenyatta International Airport (JKIA) for 30 years. The deal, known as a “build, operate, transfer” agreement, would see Adani invest in upgrading the airport’s infrastructure, including constructing a new passenger terminal, improving taxiways, and potentially building a second runway.
The agreement was approved by the Kenya Airports Authority (KAA) despite experts advising the government to put out a public tender for the expansion project. Instead, the government allowed Adani’s privately-initiated proposal to move forward, arguing that it offered distinct advantages over competitive bidding.
Under the terms of the deal, Adani would finance the improvements through revenue from the airport, increased fees, and private investment. After the 30-year concession period, the company would receive an 18% equity stake in the airport. The proposal also stated that the project’s success would be “highly dependent on favourable tax policies” from the Kenyan government.
The deal’s lack of transparency and the government’s decision to bypass a public tender process have fueled public outrage and protests. Kenyans planned to occupy the airport in protest but were ultimately blocked. The controversy has also led to demands for more information from the government, including calls from a senator for a parliamentary inquiry into the matter.
The Kenya Aviation Workers Union (KAWU) has been at the forefront of the backlash, condemning the secrecy surrounding the deal and urging its members to strike. The union members insist that the KAA should be responsible for the airport’s refurbishment and that leasing an operating airport to a foreign firm is unacceptable. They also fear potential job losses and the introduction of non-Kenyan workers, as expressed in Adani’s proposal. But who is Gautam Adani?
Who is Gautam Adani?
Gautam Shantilal Adani, born on June 24, 1962, in Ahmedabad, Gujarat, is a prominent Indian industrialist and the founder and chairman of the Adani Group, a multinational conglomerate with diverse interests including energy, logistics, agribusiness, and infrastructure. His rise from humble beginnings to becoming one of the wealthiest individuals in the world is a compelling narrative of ambition, strategic foresight, and resilience in the face of adversity.
Gautam Adani was born into a middle-class Jain family, the seventh of eight siblings. His father, Shantilal Adani, was a small textile merchant, which exposed Gautam to the world of business at an early age. The family migrated from Tharad, a town in northern Gujarat, to Ahmedabad in search of better opportunities. Adani attended Sheth Chimanlal Nagindas Vidyalaya School and later enrolled at Gujarat University to pursue a bachelor’s degree in commerce. However, he dropped out after the second year, driven by a desire to enter business rather than follow in his father’s footsteps in textiles.
In 1978, at the age of 16, Adani moved to Mumbai, where he took a job as a diamond sorter for Mahendra Brothers. This experience proved invaluable as he learned the intricacies of trading and market dynamics. By 1982, he had established his diamond brokerage firm in Mumbai’s Zaveri Bazaar, marking the beginning of his entrepreneurial journey. His early ventures laid the groundwork for what would become the Adani Group.
Founding and Growth of Adani Group.
In 1988, Gautam Adani founded Adani Enterprises, initially named Adani Exports, as a commodity trading company. The company focused on the import and export of various commodities, including agricultural products and textiles. The liberalization of the Indian economy in the early 1990s provided a favourable environment for Adani to expand his business. He diversified into trading metals, textiles, and agro-products, capitalizing on the changing economic landscape.
A significant turning point in Adani’s career came in 1995 when the Gujarat state government began privatizing port projects. Adani secured the contract to develop Mundra Port, which became operational in 1998. Mundra Port is now the largest commercial port in India and a central component of the Adani Group’s operations. The success of the port facilitated further expansion into various sectors, including power generation, renewable energy, and airport management.
Expansion and Diversification.
Under Gautam Adani’s leadership, the Adani Group diversified its operations significantly. The establishment of Adani Power in 2006 marked the group’s entry into the power sector, where it became one of the largest private power producers in India. Adani Green Energy was founded to focus on renewable energy projects, aligning with global sustainability trends. The group’s interests also expanded into logistics, agribusiness, and mining.
Adani Ports and SEZ (Special Economic Zone) emerged as a key player in India’s logistics sector, handling a significant portion of the country’s cargo. Adani Wilmar, a joint venture with Singapore’s Wilmar International, became a leading food processing company in India. The group’s aggressive expansion strategy led to its involvement in international projects, including coal mining in Australia and renewable energy initiatives in several countries.
In recent years, Gautam Adani has continued to pursue ambitious projects, including a $70 billion investment in green energy and the acquisition of major companies like Ambuja Cements and ACC from Swiss firm Holcim Group, a deal that made him India’s largest cement maker. His vision for the Adani Group remains centred on infrastructure development and sustainability, with a focus on renewable energy and logistics. He has also expanded Adani Group operations across the world with Africa, a key piece in this expansion.
Adani Airports Ltd, which signed a deal with the Kenyan government is one of the flagship companies in the Adani Group. Established on August 2, 2019, AAHL is based in Ahmedabad, Gujarat, and is classified as an unlisted public company. The firm focuses on airport development and management, with a significant emphasis on enhancing airport infrastructure and services. As of the financial year ending March 31, 2023, AAHL reported operating revenues exceeding INR 500 crore ($61.5 million), alongside a remarkable EBITDA growth of 448.67% compared to the previous year. The company’s strategic vision includes investing in modernizing airports to improve operational efficiency and passenger experience.
Adani Airport Holdings Limited (AAHL) operates several key airports across India, solidifying its position as the largest private airport operator in the country. Among its portfolio are major airports such as Chhatrapati Shivaji Maharaj International Airport in Mumbai, which is AAHL’s most significant asset, acquired from the GVK Group in 2021. Other airports under its management include Sardar Vallabhbhai Patel International Airport in Ahmedabad, Jaipur International Airport, Lucknow Airport, Guwahati International Airport, Trivandrum International Airport, and Mangaluru International Airport. Together, these airports handle approximately 23% of India’s total passenger traffic, demonstrating AAHL’s substantial influence in the aviation sector.
AAHL is actively pursuing further expansion both in India and abroad, with plans to bid for the privatization of additional airports as the Indian government prepares to privatize around 30-35 airports by 2025. The company aims to enhance its operational capabilities and connectivity through these acquisitions, which include major airports like Chennai International Airport, Bhubaneswar Airport, Amritsar International Airport, and Varanasi Airport. This strategic growth aligns with AAHL’s vision of becoming a network player in the aviation industry, facilitating seamless travel and cargo operations while focusing on increasing non-aero revenue streams to balance its financial portfolio.
Financial Standing and Net Worth.
Gautam Adani’s net worth has seen dramatic fluctuations, reflecting the volatile nature of the markets and the controversies surrounding his business practices. At his peak in early 2022, Adani’s fortune was estimated at around $206 billion, making him the richest person in Asia and one of the top three wealthiest individuals globally. However, following allegations of stock manipulation and fraud by the activist short-seller firm Hindenburg Research in early 2023, Adani’s net worth plummeted by more than $100 billion.
As of early 2024, Adani’s net worth was estimated at approximately $83.8 billion by Forbes, making him the 17th wealthiest person in the whole world. He is also the second wealthiest Indian behind only Mukesh Ambani. Despite the setbacks, the Adani Group’s market capitalization rebounded, reflecting the resilience of its diversified business model and Adani’s strategic manoeuvres. His wealth primarily stems from his holdings in publicly listed companies within the Adani Group, which consists of six publicly traded entities.
However. Gautam Adani’s rise to prominence has not been without controversy. His close ties to the Bharatiya Janata Party (BJP) and Prime Minister Narendra Modi have led to allegations of cronyism, with critics arguing that his companies have benefited disproportionately from government contracts. The Adani Group’s rapid expansion has raised concerns about environmental degradation, particularly regarding its coal mining operations and infrastructure projects.
In addition to these controversies, Adani’s business practices have faced scrutiny from regulatory bodies. The Securities and Exchange Board of India (SEBI) has previously investigated the Adani Group for stock manipulation, and the company has been accused of accounting irregularities and tax evasion. Despite these challenges, Adani has maintained a strong public image, often portraying his business endeavours as aligned with national interests and economic growth.