September 23, 2020

Aussies cry foul over Adani’s firm in Cayman Islands

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From NH National Bureau India

The visit by two Australian delegations, one to support and the other to oppose ’s coal mining project, highlights the raging debate Down Under

Anyone wishing to follow the raging controversy sparked by Adani Group’s mining project in Queensland has just to follow the hashtag #StopAdani on Twitter.

The Adani Group chairman declared in Mumbai this week that he expected work to start in August this year and the first coal to come out of what will be Australia’s largest mine in 2020. The Queensland Premier Annastacia Palaszczuk, who led a delegation of 25 mayors and officials to India, confirmed that all the clearances and approvals had come in.

Asked to comment on the parallel Australian delegation delivering a letter, signed by among others, President of the Australian Conservation Foundation Geoff Cousins and Australian cricketers Ian and Greg Chappell, opposing the project, Palaszczuk tersely replied that while the signatories of the opposing letter had ‘good jobs’, her state was struggling with unemployment and the Adani project would provide a lifeline.’

But if the hashtag is any indication, there is growing opposition to the project. In fact there is outrage at reports in Australian media claiming a ‘complex company structure’ proposed by Adanis with a royalty deed that would divert billions of dollars to a shell company registered in tax haven .

According to an ABC (Australian Broadcasting Corporation) report, an “overarching royalty deed” provides an interesting deal to a shell company, Atulya Resources Limited—a secretive entity registered in the Cayman Islands and, according to ABC, apparently controlled by the Adani family. The report says Atulya would receive a $2-a-tonne payment, rising yearly by the inflation rate, beyond the first 400,000 tonnes mined in each production year for two decades.

“In plain English, the upshot for the Adani family is [that] if the mine goes ahead, they receive a $2-a-tonne payment, so up to $3 billion, via a Cayman Islands company, a company owned in a tax haven,” ABC quotes Adam Walters, principal researcher and Energy Resource Insights.

The public outcry deepens as the Adanis are seeking up to $1 billion in public subsidyfor the project from the government down under. “What do you think? Is it a “great” idea for Gov to give $1B in taxpayer funds to a company openly sending profits offshore? (sic),” tweeted Jacqui Lambie, Senator for Tasmania.

“So #Adani is going to use its Cayman island office to pay no tax in Aust. How is this a good deal & why is NOT doing that in negotiations?” tweeted an outraged Australian. There is also anger brewing at the Group’s alleged promise to create 10,000 jobs while admitting in court that the project would create only 1,464 direct jobs.

Australian environmentalists believe that the port that Adani plans to operate woulddamage the and affect the livelihood of 70,000 people dependent on tourism. While environmentalists see the project as an “inappropriate development” creating a mortal crisis for the —the world’s largest coral reef system, others point to the futility of massive investment on fossilised fuels.

It may be noted that the Adanis have already made significant investments in the project. It acquired the Carmichael mine in the remote Galilee Basin from Singapore-based Linc Energy in August 2010 for A$500 million in cash.

Allegations that the royalty would be usurped by a subsidiary based out of a tax haven, which would allow the Adani family to enrich themselves while other shareholders are impoverished, many feel, call for a probe by the Securities and Exchange Board of India (SEBI).

IMAGE: Photo by Abhinav Saha/Hindustan Times via Getty Images File photo of Chairman and Founder of Adani Group, Gautam Adani

For more on this story go to: http://www.nationalheraldindia.com/news/2017/03/21/aussies-cry-foul-over-adanis-firm-in-cayman-islands

 

 

 

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