By | Arvind Jadhav
The Report That Shook Dalal Street
New Delhi: A major controversy has erupted following The Washington Post’s investigative report alleging that the Indian government devised a plan to channel US $3.9 billion (₹33,000 crore) from the Life Insurance Corporation of India (LIC) into companies belonging to the Adani Group.
According to the report, documents from May 2025 revealed that senior officials from the Department of Financial Services (DFS), NITI Aayog, and the Ministry of Finance allegedly worked on a strategy to direct LIC’s funds into Adani Group bonds and equity.
The newspaper claimed that the move came at a time when Adani companies were struggling with debt and foreign lenders were distancing themselves after legal scrutiny abroad.
Bond Deal Under the Scanner
The Washington Post further reported that Adani Ports & SEZ Ltd. issued a US $585 million bond on May 30, 2025, which was allegedly fully subscribed by LIC.
The article claimed that follow-up investments worth billions more were proposed under the same plan — though it remains unclear how much was actually executed.
LIC’s Strong Rebuttal: “Far From Truth”
Within hours of the report going viral, LIC issued a strong official statement, calling the allegations “false, baseless, and far from the truth.”
“No such document or investment plan as mentioned in the report has ever been prepared by LIC,” the statement read.
“All investment decisions are taken independently with due diligence, guided by board-approved policies. No external body plays any role in our investment process.”
LIC also clarified that its exposure to the Adani Group is much lower than to several other large business houses in India and remains well within approved risk limits.
Political Reactions: Opposition Demands PAC Probe
The opposition Congress Party has demanded a Public Accounts Committee (PAC) investigation, calling the alleged plan a “bailout using citizens’ savings.”
Senior Congress leaders alleged that the Modi government has “systematically used public institutions to protect corporate allies,” demanding full transparency from LIC and the Finance Ministry.
Meanwhile, the Adani Group has not issued a fresh statement but reaffirmed that all its financial dealings comply with SEBI and RBI norms.
Regulators Keep a Watchful Eye
Sources within the Securities and Exchange Board of India (SEBI) and the Insurance Regulatory and Development Authority (IRDAI) have confirmed they are “monitoring the situation closely,” though no formal investigation has been initiated so far.
Experts say the episode highlights the need for greater transparency in public-sector investment practices, especially when large sums are involved in politically sensitive corporations.
What’s Next for LIC and the Adani Group?
So far, the documents cited by The Washington Post have not been released publicly, leaving a cloud of speculation.
The government has not commented officially, while LIC maintains its denial in strong terms. For now, the controversy remains a battle of narratives — between an international exposé and a domestic denial.
The incident has once again sparked debate on the autonomy of India’s largest insurer, which manages over ₹49 lakh crore in assets belonging to nearly 30 crore policyholders.
