01:34 GMT22 February 2020
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    Towards the end of India's 2019 general election, something interesting happened. Two business groups — Anil Ambani's Reliance Group and Gautam Adani's Adani Group — were in the news regarding the withdrawal of their huge defamation lawsuits.

    On 21 May, the Anil Ambani-led Reliance Group announced the withdrawal of its approximately $715 million defamation suits against India's Congress Party and its publication, the National Herald.

    With the opposition party crying foul over the offset agreement between the Reliance Group and France's Dassault Aviation for the €7.87-billion Rafale jet deal, the suits were over an article and the various statements made by Congress leaders.

    A day after, the IANS news agency reported on the Adani Group also withdrawing all defamation suits filed against The Wire and its editors in an Ahmedabad court for articles against its companies.

    READ MORE: Indian Apex Court Dismisses Staff Illegally Helping Corporate Czar

    Both these business tycoons are said to have good relations with Prime Minister Narendra Modi, and Congress President Rahul Gandhi often derided them during the run-up to the elections.

    Given the timing of all this, speculations immediately arose. Most exit polls, which proved to be spot on, predicted a landslide victory for the Modi-led National Democratic Alliance (NDA) coalition. Conjectures were being drawn on these tycoons possibly knowing about a split verdict.

    This was because back in May 2004, a day before the Lok Sabha results, Anil Ambani called upon Congress President Sonia Gandhi. He was then vice-chairman of the undivided Reliance Group. Though exit polls had predicted victory for Prime Minister AB Vajpayee, the next day's results went in favour of Congress leading a coalition government.

    On May 23, that speculation was squashed as the Bharatiya Janata Party (BJP) got an overwhelming 303 seats out of the 542 seats for which elections were held-way beyond the required 272 seats for a majority.

    So, what then was the withdrawal of these cases about?

    The Official Line

    Sputnik learnt that the Reliance Group's decision was, in fact, conveyed to the National Herald on May 19 itself, even as the seventh and final phase of the Lok Sabha election was coming to an end. While confirming this, National Herald Editor-in-Chief Zafar Agha says, "This is still a sub judice matter. Technically, the formal process to withdraw the suits would begin only in the next hearing once the court resumes after the summer vacation."

    However, Agha, clarifies, "We have no reason to believe that they won't withdraw the suits."

    Explaining the reason behind the decision, Reliance Group spokesperson Daljeet Singh says: "We believe that the defamatory statements by certain individuals and corporate bodies with regard to the offset agreement between Reliance Group and Dassault Aviation were made for political purposes in the run up to the Lok Sabha election 2019 that have concluded on May 19,"

    Singh told Sputnik that as the subject matter was also pending for adjudication before the Supreme Court, the group decided to withdraw the defamation suits filed by it.

    Meanwhile, efforts to get a response from the Adani group spokesperson on the issue was futile as this article went to publication. However, Adani company sources said that the process for withdrawal of the cases against the portal was on.

    Siddharth Varadarajan, founding editor of The Wire, told Sputnik that they have received no formal notice from the Adani Group as yet.

    Interestingly, sources tell Sputnik that the Anil Ambani's Reliance Group doesn't plan to withdraw its around Rs 11,000 crore defamation suits against The Wire. This includes the Rs 6,000-crore suit for an online video show on the controversial Rafale deal. The National Herald article, incidentally, was on the jet deal as well.

    Digging Deeper

    So, is there more to these selective decisions by the business groups? One reasoning has been that being on the wrong side of political parties — whether in power or not — and being drawn into a political joust constantly was something a business group would rather want to avoid.

    "A company would to try avoid negative publicity as much as possible. It is best to minimise collateral damage," says TV Mohandas Pai, chairman of Aarin Capital and former director of Infosys, a bellwether Indian information technology company.

    Besides, if the cases dragged on, the issue would be continuously highlighted in the press and by the Opposition, and there was also the possibility of the government being called by the courts to depose.

    Pai though says that the scam allegations such as that on Rafale didn't really cut ice with the voters as the poll verdict showed.

    That apart, in the case of Anil Ambani, he has been riding rough on the business front. His group company, Reliance Communications (RCom), was recently declared bankrupt. RCom was reported of owing around Rs 50,000 crore to banks. Earlier, he fended off a possible jail term regarding the clearing of outstanding dues to Swedish telecom equipment maker Ericsson. He was rescued at the last moment by his elder brother Mukesh Ambani-the richest Indian with assets over $45 billion-who helped in the payment of about Rs 462 crore.

    A quick background: the Reliance Group, founded by Dhirubhai Ambani was split into two after a public spat between brothers Mukesh and Anil in 2005.

    READ MORE: Indian Tycoon Mukesh Ambani Becomes Asia's Richest Man

    The Adani group too has heavy debts. One of the Wire's articles published in 2017 that got sued for Rs 100 crore was on public sector behemoths IOC and Gail India investing in Adani's LNG Terminals. It points to Adani group's outstanding debts then having "shot up to Rs 72,000 crore".

    Given all this, while it may be assumed that these groups would want to avoid negative publicity, things are still hazy at their selective decisions. Perhaps this is just a start and how it pans out, only time will tell.

    The views and opinions expressed in this article are solely those of the author and do not necessarily reflect those of Sputnik.

    The views and opinions expressed in the article do not necessarily reflect those of Sputnik.

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    defamation, liquefied natural gas (LNG), Adani Group, Anil Ambani, India
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