Environmental Justice Australia (EJA) has written to the Bombay Stock Exchange, asking it to clear up confusion around which company is seeking Northern Australia Infrastructure Facility (NAIF) funding to build a coal-carting rail line from Adani’s proposed Carmichael mine.
EJA has advised the Bombay Stock Exchange of contradictory and unclear reports on the identity of the applicant.
On 20 October 2016, in an answer to a question in the Economics Legislation Committee about ‘specific potential proponents’, the Federal Government confirmed NAIF had been in discussions with ‘Adani Australia’.
However, on 8 December 2016, Adani Enterprises Ltd, a publicly listed company in India that holds regulatory approvals for the Carmichael rail line, wrote to the Bombay Stock Exchange and said it did not have an interest in the rail project.
On 12 March 2017 Reuters reported Adani Enterprises had applied for NAIF funding. NAIF has refused Freedom of Information requests that would reveal the identity of the applicant.
To add to the confusion, media reports suggest Adani plans to shift up to $3 billion of royalties from the planned Carmichael coal mine to a privately owned subsidiary company in the Cayman Islands.
“Adani Enterprises Ltd’s relationship with the Carmichael rail project and NAIF is confusing,” said David Barnden, lawyer at Environmental Justice Australia.
“The company’s investors risk being misled. Adani Enterprises says it is not involved in the Carmichael rail project, but Reuters reports Adani Enterprises has applied for NAIF support.
“If an opaque, privately owned company based in the Cayman Islands has applied for NAIF funding, instead of a publicly owned company, the project’s financial risk profile would skyrocket.
“NAIF’s board must be satisfied the loan will be repaid, and it must comply with best practice.
“Experts recently described Adani’s Cayman Islands companies as a ‘classic third-world pyramid structure’. Would NAIF’s board seriously lend money to a secretive private company ultimately owned in a tax-haven?
“The precise identity of the applicant should be of great interest to Adani’s investors, so we wrote to the Bombay Stock Exchange today, asking it to seek clarification from the company.”
India’s Economic Times attributed a 4 per cent surge in the Adani Enterprises share price to the news – announced to Reuters by Australia’s resources minister, Senator Canavan – that Adani Enterprises had applied to NAIF for funding.