An Indian Government official has denied a Washington Post report that claimed Department of Financial Services (DFS) officials “drafted and pushed through a proposal in May to steer roughly $3.9 billion in investments to Adani’s businesses from the Life Insurance Corporation, or LIC.”

In an exclusive note to Indian Express, the government official clarified that DFS has not written any letter to LIC asking it to invest in the Adani Group.

“The documents being mentioned in the media are not from DFS. It’s not true that DFS wrote to LIC to invest in Adani companies… DFS doesn’t write such letters to LIC,” the official said.

LIC also rejected the claims made by the US media outlet saying, “The allegations levelled by Washington Post that the investment decisions of LIC are influenced by external factors are false, baseless, and far from truth.”

Adani Group has also categorically denied involvement in any alleged government plans to direct LIC funds. Group’s spokesperson was quoted by the Post stating, “LIC invests across multiple corporate groups — and suggesting preferential treatment for Adani is misleading. Moreover, LIC has earned returns from its exposure to our portfolio.”

Charges made by Washington Post report

The publication had claimed that its “investigation is based on documents from LIC and the Indian Department of Financial Services (DFS), a branch of the country’s Finance Ministry, interviews with current and former officials at those agencies, as well as three Indian bankers familiar with Adani Group finances.”

The report further claimed that two officials familiar with the matter told them that officials at ‘DFS crafted the investment plan in coordination with LIC and India’s main government-funded think tank, Niti Aayog, the documents show, and approved by the Finance Ministry.’

According to the report, DFS documents hailed Adani as a “visionary entrepreneur” whose company has shown
“remarkable resilience in the face of significant challenges.”

It further reported that the proposal materialised the same month that Adani Ports and Special Economic Zone Ltd sought to raise around $585 million through a bond issue to refinance existing debt. “On May 30, Adani Group announced that the entire bond had been financed by a single investor — LIC — in a deal immediately criticised by opposition leaders and commentators as a misuse of public funds,” the newspaper reported.

As per the claims made in the said report, the DFS documents acknowledged that the proposed investment strategy came with risks. “Adani’s securities are sensitive to controversies… causing short-term price fluctuations,” the newspaper asserted, quoting one document.

According to the report, the documents and interviews show “it was just one piece of a larger plan by Indian authorities to direct taxpayer money to a conglomerate owned by one of the country’s most prominent and politically well- connected billionaires”.

It further said the said document noted, “LIC lost roughly $5.6 billion in gains on paper after the 2023 Hindenburg report, with its investment value falling to roughly $3 billion by February 2023. The value of LIC’s holdings recovered to $6.9 billion by March 2024, the document said, meaning losses had not been fully recouped at that time. The current market value of the investment could not be determined,” the Washington Post report said.?

Congress has demanded probe by Public Accounts Committee, its spokesperson Jairam Ramesh said, “The question arises: under whose pressure did the officials of the Ministry of Finance and NITI Aayog decide that their job was to bail out a private company facing funding difficulties due to serious allegations of criminality?? Is this not a textbook case of ‘mobile phone banking’?”

LIC response to $3.9bn allegations

In its statement, LIC said, “No such document or plan as alleged in the article has ever been prepared by LIC, which creates a roadmap for infusing funds by LIC into Adani group of companies. The investment decisions are taken by LIC independently as per Board approved policies after detailed due diligence. The Department of Financial Services or any other body does not have any role in such decisions…. These purported statements in the article appear to have been made with the intentions to prejudice the well settled decision-making process of LIC and also to tarnish the reputation and image of LIC and the strong financial sector foundations in India.”

Insurer sources told Indian Express, the state-owned life insurer has not received any letter or document from DFS about investing $3.9 billion in the Adani Group. “LIC has not asked for any approval from DFS to invest in Adani group. It’s not true,” a senior LIC executive said.

“LIC’s investments are all long term. This is done as per the IRDAI regulations and as per the board approved policy. LIC’s investments in the shares of Adani group companies are around Rs 39,000 crore. Many of these were done even before some of these came under the Adani fold,” executive told Express.

“LIC investments in other business groups like Reliance, Tatas and Birla are much higher than its investment in Adani. The Rs 5,000 crore investment in NCDs of Adani Port is less than one per cent of its total investment of Rs 5-6 lakh crore investment every year,” the executive told Express.

LIC’s investment in Adani Group

According to a report published by The Indian Express on December 2, 2022, LIC had significantly raised its exposure to the Adani Group. In just eight quarters from September 2020, LIC’s stake in four of the seven listed Adani firms rose sharply. Public disclosures at the time showed that as of December 1, 2022, the value of LIC’s holdings in these companies stood at Rs 74,142 crore, about 3.9 per cent of the Adani Group’s market capitalisation of Rs 18.98 lakh crore. Within LIC’s overall equity portfolio of Rs 9.3 lakh crore (as of June 2022), its Adani investments alone accounted for 7.8 per cent.

The insurer’s exposure had ballooned nearly ten-fold in just over two years, climbing from ₹7,304 crore in September 2020 (1.24 per cent of its equity assets under management) to more than ₹74,000 crore by December 2022.

However, the value of Adani stocks came under severe pressure after January 2023, when U.S.-based Hindenburg Research accused the conglomerate of “brazen stock manipulation and accounting fraud.” The slide deepened in November 2024 after a U.S. court indictment alleging a ₹2,000-crore bribery scheme to secure energy contracts. Over 22 months, investors saw the market value of ten Adani firms shrink by an estimated ₹7 lakh crore ($82.9 billion).

In a relief to the group, the Securities and Exchange Board of India (SEBI) on September 19, 2025, dismissed allegations of stock manipulation and fund diversion raised in the Hindenburg report. In two separate orders, the regulator held that Adani entities had not violated norms on related-party transactions.