One of the world’s largest investors, PIMCO, has banned future investment in Adani Ports and Special Economic Zone (Adani Ports) due to the company’s role in the controversial Adani Carmichael coal project in Australia.
PIMCO, which manages US$2.21 trillion, did not participate in the most recent bond issue by Adani Ports in late January 2021, and will not participate in future bond offerings to the company.
In 2020, PIMCO was the biggest known bondholder in Adani Ports, with over US$100m invested.
Confirmation of the exclusion comes after Market Forces, as part of the #StopAdani campaign, initiated a dialogue with PIMCO and its parent company Allianz in August 2020 to inform them that Adani Ports had set up the Bowen Rail Company to transport coal from the under-construction Carmichael thermal coal mine to the Abbot Point port in the Great Barrier Reef World Heritage Area.
Market Forces Executive Director, Julien Vincent, says that PIMCO’s prohibition of further investment in Adani Ports sends an important signal to the entire Adani Group:
“PIMCO’s Adani Ports ban is a huge financial blow. The reputational damage and financial risk caused by pursuing the Carmichael coal project in the midst of the climate crisis is now spreading through the entire Adani conglomerate like a disease.
“More than 90 companies have now publicly refused to have anything to do with the Carmichael mine, or the Adani Group more broadly. Adani’s executives should be reconsidering the Group’s ongoing support for the project before the rot sets in further,” Mr Vincent said.
Adani Ports has already felt the impacts of its association with the mine, with reports indicating Deutsche Bank withdrew from arranging its bonds in January due to ‘conflict with the sustainability goals of the bank’. Additionally, S&P Global is currently reviewing the inclusion of Adani Ports on its Dow Jones Sustainability Index (DJSI), due to evidence presented to them of its participation in the Carmichael project, environmental destruction and business dealings with the Myanmar military carried out by the company.
With Deutsche Bank’s withdrawal and S&P’s DJSI review signalling that the reputationally damaging Carmichael brand is impacting other Adani companies’ appeal to investors, the remaining bankers are now in Market Forces’ firing line.
“It is disappointing to see banks that have ruled out directly funding Adani Carmichael, such as Barclays, Standard Chartered and Credit Suisse, continue to risk funding the climate-wrecking project indirectly by issuing bonds for Adani Ports. These banks also need to make sure they’re not funding the Carmichael project through other Adani Group companies,” Mr Vincent concluded.