For truckers transporting cement from Adani’s factories in Himachal Pradesh, US short-seller Hindenburg’s critical research report on the conglomerate was a godsend they say helped them save their livelihoods.
For weeks, around 7,000 truck owners and drivers in the hill state resorted to protest rallies against Adani’s December 15 decision to shut two cement plants over a dispute on freight rates. Adani argued the plants were “unviable” at the trucking rates, which it wanted to slash by around half.
On Monday, the Gautam Adani-led group said it had “amicably resolved” the issue with a 10-12 per cent reduction in rates. Truckers rejoiced, with a union leader in a street address labelling it a victory after late-night talks with Adani.
The settlement comes four weeks after US-based Hindenburg Research accused Adani of stock manipulation and improper use of tax havens, allegations the group has called baseless. While the truckers’ settlement will have only a small impact on the overall Adani empire, it was a big win for the drivers and owners in a state where most people live on around Rs 580 a day.
The report “played a crucial role in our battle against India’s biggest business group, helped mobilise truckers and gain political support”, said Ram Krishan Sharma, one of the lead negotiators for the protesting truckers.
Adani negotiators had refused to budge for weeks. So Hindenburg’s report, some truckers believe, was godsent. Just a day before it was published, many truckers visited a small, revered Hindu temple in Darlaghat which overlooks one of Adani’s cement plants. The Adani group did not answer Reuters’ questions on whether the Hindenburg report’s fallout contributed to its decision in Himachal. Adani Cements in a statement said it was “grateful” to all stakeholders including the unions, the chief minister and other departments. A source familiar with Adani’s negotiation said the group had been under pressure following what it thought was a “negative campaign” by Adani’s opponents after the Hindenburg report, and that the settlement to reopen plants was a relief.
Himachal is ruled by the Congress. After the Hindenburg report, the Congress has renewed its claims that Prime Minister Narendra Modi has for years unduly favoured Adani. Both Adani and India’s government deny that. The source added the move will also help Adani signal it can resolve commercial matters in states ruled by the BJP’s rivals. Without citing Hindenburg, the Himachal chief minister’s office on Monday said “we have been successful in resolving the issues” to end the 67-day dispute.
Adani became India’s second-largest cement manufacturer when it acquired ACC and Ambuja Cements in a $10.5-billion deal with Swiss giant Holcim last year. In December, it shut plants in the villages of Gagal and Darlaghat in Himachal, saying the truckers were charging too much. The Adani group wanted the freight rates lowered to around Rs 6 per tonne per km, from around Rs 11. Many truckers told Reuters they struggled to make their loan repayments as their incomes shrank after the shutdowns.
As a stalemate worsened, truckers formed WhatsApp groups to coordinate efforts, vent frustration and later share Hindenburg’s impact on Adani companies and stock prices to further drum up support. One such WhatsApp group chat of around 1,000 truckers showed the sharing of a local reporter’s video discussing the sharp fall in Adani’s shares and his perceived close ties to Modi. Although they accepted a small cut in freight rates when Adani agreed to pay Rs 9.3-10.58 per km per tonne, the truckers felt they had saved their jobs, and prayers at the temple were organised again this week.
