19 November 2020
As the global economy reels from the coronavirus pandemic and following a string of nations’ leaders committing to carbon neutrality in the face of intensifying climate catastrophes, the State Bank of India (SBI) is doing the unthinkable and considering loaning around A$1billion to Adani’s internationally shunned Australian coal project.
Eighty-nine companies have refused to be involved with Adani’s coal project, including some of the world’s largest banks and insurers, because of the controversy and reputational risk associated with the climate-wrecking project. SBI’s loan would expose Indian taxpayers to risks that private investors refuse to accept, all while fuelling ever-worsening extreme heatwaves, drought and floods devastating the lives of communities in India and Australia.
While China, Japan and Korea commit to net zero emissions, Adani’s coal mine undermines global efforts to mitigate the threats of runaway climate change and locks India into expensive and toxic thermal coal energy. As solar and wind power are already far cheaper than fossil fuels in India, SBI’s funding of Adani’s coal mine would contribute to increasing electricity prices for many people who can barely afford it.
The questions SBI needs to answer are; why is the bank even considering this loan now? Who will benefit and at whose cost? What due diligence has SBI done on Adani’s coal project considering analysts have repeatedly questioned its economic viability? What regulatory oversight will be placed on this loan and what collateral secured? And finally, how does a banking sector riddled with non-performing assets find $1 billion for an offshore coal mine in the midst of a deadly pandemic and related economic collapse?
SBI must follow the lead of the dozens of major banks that have ruled out Adani, and demonstrate its independence by acting in the interest of the people it is supposed to work for – rather than what appears to be purely in the interest of a well-connected billionaire.
Tell the State Bank of India that, in 2020 when Covid-19 and climate change are threatening millions of lives, lending $1 billion to a new thermal coal mine would be a global disgrace.