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Officials of India’s finance ministry fast-tracked a proposal in May this year to direct approximately $3.9 billion in investments from the Life Insurance Corporation of India (LIC), a state-owned insurance and investment company, to an Adani group firm despite being aware of the risks, Washington Post has reported.
The proposal came at a critical juncture when the entity was in need of funds to refinance its existing dollar debt obligations, the report by Pranshu Verma and Ravi Nair said.
In 2024, US prosecutors had charged eight people, including Gautam Adani, for allegedly agreeing to pay around $265 million in bribes to government officials in India to obtain contracts for a solar power plant project. The indictment had resulted in reluctance of global banks to extend loans to the group.
On May 30, 2025, Adani Ports and Special Economic Zone Ltd (APSEZ), India’s largest integrated transport utility, announced raising Rs 5,000 crore through a 15-year Non-Convertible Debenture (NCD). The NCD, with a coupon rate of 7.75%, was fully subscribed by the LIC “backed by APSEZ’s strong financials and a ‘AAA/Stable’ domestic credit rating,” APSEZ claimed.
The LIC’s decision to invest in the Adani group company was met with criticism including from Rahul Gandhi, Leader of Opposition. “Money, policy, premium are yours; Security, convenience, benefit for Adani!,” he had stated on a post on social media form X in June 2025.
LIC’s exposure to the Adani Group has significant implications for middle-class savings as it is considered the primary custodian of their long-term, low-risk investments and guaranteed returns.
Union Finance Ministry proposed that LIC spread out its $3.4 bn bond investments into APSEZ and Adani Green Energy Ltd as it offered higher returns than 10-year government securities, The Washington Post report said. The officials also recommended use of LIC funds to increase equity in Adani groups companies including Ambuja Cements and Green Energy.
It also said the LIC requested facilitation of “a swift review and approval process,” as the investments were “time-sensitive.”
The Washington Post investigation is based on documents from LIC and the Department of Financial Services (DFS), a finance ministry branch which acts as the nodal Department of Banking, Financial Services, and Insurance (BFSI), which administers and executes initiatives and reforms in the sector.
The report also relied on interviews with current and former officials in these agencies, and three bank officials familiar with Adani Group finances.
The report said, officials at DFS, working in coordination with the LIC and Niti Aayog, Indian government’s premier policy think tank, developed the investment plan, which subsequently received approval from the Union finance ministry.
The report, quoting documents, says that the DFS was aware of the risks in the proposed investment strategy because of the sensitive nature of Adani’s securities prone to short-term price fluctuations.
The Adani Group categorically denied any “alleged government plans to direct LIC funds,” in response to questions from the media outlet. “LIC invests across multiple corporate groups — and suggesting preferential treatment for Adani is misleading. Moreover, LIC has earned returns from its exposure to our portfolio,” the response said.