US president Donald Trump signed an executive order on Monday, 10 February, pausing the enforcement of the Foreign Corrupt Practices Act (FCPA), a federal law that criminalises bribery of foreign officials by U.S. businesses. Notably, industrialist Gautam Adani has been charged under this same act and all the listed stocks of the Adani Group witnessed substantial gains as markets in India opened on 11 February, Tuesday. The directives from Trump came at a time when PM Narendra Modi is headed to the US and will meet Trump this week.
The US President directed Attorney General Pam Bondi to suspend actions under the Act, until she establishes new enforcement guidelines, as outlined in a fact sheet on the executive order. Additionally, all current and past actions under the FCPA will be reviewed.
“Since its enactment in 1977, the Foreign Corrupt Practices Act (15 U.S.C. 78dd-1 et seq.) (FCPA) has been systematically, and to a steadily increasing degree, stretched beyond proper bounds and abused in a manner that harms the interests of the United States,” according to a White House statement.
Current FCPA enforcement impedes the United States’ foreign policy objectives and therefore implicates the President’s Article II authority over foreign affairs. The FCPA forbids any company or individual with US ties from offering money or gifts to foreign officials to secure business overseas. Trump had considered eliminating the law during his first term.
“The President’s foreign policy authority is inextricably linked with the global economic competitiveness of American companies. American national security depends in substantial part on the United States and its companies gaining strategic business advantages whether in critical minerals, deep-water ports, or other key infrastructure or assets,” according to the statement.
“But over expansive and unpredictable FCPA enforcement against American citizens and businesses — by our own Government — for routine business practices in other nations not only wastes limited prosecutorial resources that could be dedicated to preserving American freedoms, but actively harms American economic competitiveness and, therefore, national security,” it emphasised.
“It is therefore the policy of my Administration to preserve the Presidential authority to conduct foreign affairs and advance American economic and national security by eliminating excessive barriers to American commerce abroad,” said the order.
In a significant development for the Adani Group, all its listed stocks witnessed substantial gains, after US President Donald Trump signed an executive order to ease the enforcement of the FCPA.
The most notable gainer was Adani Enterprises Ltd., which saw a 4.28 per cent advance in its stock price. Following closely was Adani Power Ltd., which rose 4.17 per cent to Rs 511.90 apiece. Adani Green Energy Ltd. was the third top gainer, as it jumped 3.34 per cent to Rs 985.90 apiece. New Delhi Television Ltd.'s share price also rose 3.84 per cent to Rs 145 apiece. While, Adani Energy Solutions Ltd., Adani Total Gas Ltd., and Adani Ports and Special Economic Zone Ltd. shares were also up.
Meanwhile, six US lawmakers have written a strongly worded letter to Attorney General Pam Bondi, demanding a probe into the previous Department of Justice's (DoJ) indictment of Adani Group officials.
The six US lawmakers - Lance Gooden, Pat Fallon, Mike Haridopolos, Brandon Gill, William R Timmons and Brian Babin - said in the letter that the DoJ's action was a "misguided crusade" that came at the "risk of harming" America's relationship with a "strategic geopolitical partner" like India. "This case rests on the allegation that preparations were made by members of this company in India to bribe Indian officials, also exclusively located in India.
Instead of deferring the case to the appropriate Indian authorities, the Biden DoJ decided to push forward and indict the company's executives without any real injury to US interests being present," the Congressmen wrote in the letter.
According to them, there was "no compelling reason" to pursue a case in a manner that could complicate relations with an ally like India, unless some external factors were at play. "This misguided crusade came at the risk of harming our relationship with a strategic geopolitical partner like India immediately preceding President Trump's return to the Oval Office," they added.
In November last year, the Adani Group had rejected as baseless the move by the DoJ under the Joe Biden administration to name the conglomerate in a case of alleged wrongdoing.
The lawmakers said in the letter that considering Donald Trump's commitment to revive America's economic prosperity, their economic relationship with "valuable partners" from India is an "important factor" in achieving that goal. "Needless pursuits against those who have contributed tens of billions and created thousands of jobs deter and discourage investors from contributing to our economy. Considering these factors and the lack of any real injury to U.S. interests, the decision to pursue this indictment demonstrates more harm for America's interests than good, if any," they emphasised.
The US and India share a sense of mutual respect and appreciation - a sentiment emulated by President Trump and Prime Minister Narendra Modi.
"We request you investigate the Biden DoJ's conduct and would appreciate you sharing with us all records pertaining to this case, for a coordinated effort in uncovering the truth," they added. Last month, leading American publication Forbes said that the DoJ indictment of Adani Group officials is a “strategic blunder with severe geopolitical consequences”. In an article titled 'The US Harms The West's Alliances With A Far-Flung Indictment In India', the author, Melik Kaylan, argued that the indictment, which alleges bribery and financial misrepresentation, "risks damaging India-US relations at a time when Washington is actively seeking stronger alliances to counter China’s rising influence".
