Lok Sabha Question No. 177 (STARRED), answered on 2023-03-13
Subject: Loan to Adani Group
Ministry: FINANCE
Asked by: Deepak Baij

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## STARRED QUESTION NO. *177

TO BE ANSWERED ON THE 13 TH  MARCH 2023/ PHALGUNA 22, 1944 (SAKA)

## LOAN TO ADANI GROUP

## *177. SHRI DEEPAK BAIJ:

Will the Minister of FINANCE be pleased to state:

- (a) the  details  of  loan/credit  exposure  of  various  public  sector  banks  and  insurance companies to Adani group of companies as on date and on 31 st  December, 2022, bankwise and company-wise;
- (b) whether various  banks  have assessed the risks  involved  in  recovery  of  loans/credit exposure to Adani group of companies which have eroded their net assets and market cap substantially during the current year;
- (c) if so, the details thereof, public sector bank and insurance company-wise; and
- (d) if not, the reasons therefor?

The Finance Minister (SMT. NIRMALA SITHARAMAN)

- (a) to (d): A statement is laid on the Table of the House.

***

## ANSWER

## Statement for Lok Sabha Starred Question no. *177 for 13 th  March 2023, regarding 'Loan to Adani Group' by SHRI DEEPAK BAIJ, Member of Parliament

(a) to (d): The Reserve Bank of India (RBI) has informed that under the provisions of section 45E of the Reserve Bank of India Act, 1934, RBI is prohibited from disclosing credit  information.  Section  45E  provides  that  credit  information  submitted  by  a  bank shall be treated as confidential and not to be published or otherwise disclosed.

The Life Insurance Corporation of India (LIC) has informed that its debt exposure to Adani Group of Companies, as per annexed details, was ₹ 6,347.32 crore and ₹ 6,182.64 crore, as on 31.12.2022 and 5.3.2023, respectively.

The five Public Sector General Insurance companies have informed that these companies do not have loan/credit exposure to Adani Group of Companies.

Public Sector Banks have informed that loans are sanctioned after assessing the viability of projects, prospective cash flows, risk factors and availability of adequate security and repayment of loans are ensured by the revenue generated by the project and not by the market capitalisation of the company.

As per inputs received from RBI, in order to protect banks from risk, it has implemented large  exposure  framework  which  limits  the  exposures  that  a  bank  can  take  to  a  single counterparty and a group of connected counterparties to 20 per cent (extendable to 25 per  cent  by  the  Board  of  the  bank  under  exceptional  circumstances)  and  25  per  cent, respectively, of the eligible capital base of the bank. Also, as per RBI guidelines, banks are required to have a clear policy regarding the Debt-Equity Ratio for project financing to ensure that promoters bring in equity funds proportionate to bank finance. To address the  concentration  risk  emanating  from  large  exposure  to  banking  system,  RBI  has stipulated  banks  to  maintain  additional  provisions  and  additional  risk-weights  on  the incremental  exposures  towards  specified  borrowers  having  overall  aggregate  sanction credit limit of ₹ 10,000 crore.

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## Lok Sabha Starred Question no. *177 for 13 th March 2023, regarding 'Loan to Adani Group'

## LIC's debt exposure in Adani Group of Companies

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amount in crore ₹

| Company                                 | Outstanding (as on 31.12.2022)   | Outstanding (as on 5.3.2023)   |
|-----------------------------------------|----------------------------------|--------------------------------|
| Adani Ports and SEZ                     | 5,553.27                         | 5,388.60                       |
| Adani Power (Mundra) Ltd.               | 266.46                           | 266.46                         |
| Adani Power Maharashtra Ltd.- Phase I   | 81.60                            | 81.60                          |
| Adani Power Maharashtra Ltd.- Phase III | 254.87                           | 254.87                         |
| Raigarh Energy Generation Ltd           | 45.44                            | 45.44                          |
| Raipur Energen Ltd.                     | 145.67                           | 145.67                         |
| Total                                   | 6,347.32                         | 6,182.64                       |

Source: LIC