Why SBI is under the spotlight to reject a billion-dollar loan to Adani’s Australia mine

In early December, three major global financial institutions warned the State Bank of India against extending a loan to the Adani Group’s controversial Carmichael coal mine in Australia. The three organisations—BlackRock, the world’s largest asset manager; Amundi, Europe’s largest asset manager; and Storebrand ASA, a Norweigian financial-services company—all hold investments with SBI. The trio are the latest of several major investors, insurers and banks that reached out to SBI in the wake of media reports that the bank would grant the Adani Group a loan of Rs 5,000 crore—or $1 billion—to fund the coal project.

Just days before, a group of protesters had assembled in front of the Sydney Cricket Ground to protest the proposed loan. Two protestors even interrupted a match between India and Australia by running into the pitch, holding up placards that read, “State Bank of India No $I Billion Adani Loan.” A media release by the Galilee Blockade—one of several environmental groups opposing the mine—stated, “Millions of Indian taxpayers who are watching the first game of the Indian cricket tour have a right to know that the State Bank of India is considering handing their taxes to a billionaire’s climate wrecking coal mine.”

The Adani Group first announced its plans to setup the Carmichael mine in 2010, proposing to build it in the vast untapped coal reserves of the Galilee Basin in Queensland, a state in north-eastern Australia. Although Adani was not the first to propose mining the Galilee, the other companies appeared to depend on the infrastructure that the Indian conglomerate had proposed. This infrastructure included an airfield to transport workers, and a rail line to connect the mine to Adani’s Abbot Point coal terminal. According to a Greenpeace report released in 2012, there were nine proposed mines in the Galilee Basin by that year, which would produce a collective total of 330 million tonnes of coal per year, releasing 705 million tonnes of carbon dioxide.

The Carmichael coal mine would lead the pack. Carmichael is among the world’s biggest greenfield coal mine project—coal fields that are previously unexplored. Adani proposed an annual production of 60 million tonnes, which alone would lead to carbon emissions that threaten the country’s commitments under the Paris Agreement of 2015, an international treaty in which countries resolved to voluntarily reduce greenhouse gas emissions. The mine would also draw 12.5 billion litres of water from Australia’s Suttor river every year and threaten the survival of the Great Barrier Reef.

The campaign against Adani has seen participation from numerous environmental and civil-society groups, which have spearheaded massive protests against the group’s mining operations. This included mobilisation on the massive greenhouse emissions it would cause amid a losing battle against climate change, the encroachment of land belonging to the indigenous Wangan and Jagalingou people, and pressurising corporates to stop funding Adani.

As of 30 December 2020, at least 90 organisations—including finance, transportation and insurance companies—had declared that they would not continue their relations with the Carmichael mine project. In November 2020, the news agency IANS reported that the Indian government-owned State Bank of India was set to offer Adani the loan and that “a ratification is expected from the bank’s executive committee soon.” SBI had entered into a memorandum of understanding with Adani to provide the loan back in 2014, but subsequently withdrew from the commitment. The SBI has not officially confirmed or denied the recent reports that it is going ahead with the $1 billion loan.

“It is one of our key areas of focus because there is so much thermal coal in the Galilee coal basin that we believe should stay in the ground,” Pablo Brait, a campaigner with Market Forces, told me. Market Forces is one of the environmental groups in the anti-Adani campaign that focuses on communicating the risk of the project to the financial contributors to the Carmichael mine. “There have been several proposals for very large mines in the region,” Brait told me. “The others haven’t even started construction and probably would never get built without the Adani Carmacheal mine making it easier for them by building facilities like the rail line.”

The persistent movement against the project has made it all the more crucial for the Adani Group to secure the loan with SBI. Meanwhile, Adani appears to have pulled out all the stops to save the project, including changing the name of its Australia operations to Bravus Mining and Resource in November 2020. (After the announcement, The Guardian reported that an Adani official had described the word bravus as “the medieval Latin word for ‘courageous,’ while Latin experts said the word actually means “crooked” or “deformed.”) The company’s actions in Australia have parallels in its mining operations in India, including allegations that it subverted legal procedures that secure the rights of indigenous communities over their land. Gautam Adani, the billionaire industrialist and chairman of the group, who is known to be close to the Indian prime minister Narendra Modi, also appears to have courted Australia’s political class.

Securing the SBI loan would be a major victory for Adani, and the fact that the largest Indian national bank has so far not succumbed to the public pressure against the Carmichael project is a promising sign for the mining behemoth. Yet, for both SBI and Adani, the biggest obstacles they face do not come from the damage to the environment or the large mobilisation against the project, but from problems they created themselves.

For Adani, the group’s massive indebtedness has been a major factor giving companies pause for thought about collaborating on the mine. For SBI, the bank’s own policies on sustainability and initiatives to invite investors on the strength of its environmental practices are inconsistent with the Carmichael project. Perhaps this explains the SBI’s strategic silence on media reports about the bank’s continued involvement in the project. But as the number of detractors from Adani’s Carmichael mine continues to grow, and the mobilisation against it shows no sign of stopping, the SBI is under increasing pressure to take a stand and face the consequences.

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Even getting to this contentious stage has been a long journey for Adani. The company announced its plan of setting up the Carmichael coal project—comprising six open-cut pits and five underground mines, as well as a new 389-kilometre-long railway line to Adani’s Abbot Point coal terminal—in 2010. The project would spread over approximately 280 square kilometres, to become the largest coal mine in Australia, and among the largest in the world.

It began the process to obtain government approval for the construction of mines and the rail line in November that year. That month, Anna Bligh, then the premier of Queensland—the Australian equivalent to a chief minister—announced that it was a “significant project” that was estimated to create over 11,000 jobs. In May 2014, the state approved the $16.5 billion project, and two months later, the environment minister, Greg Hunt, approved Adani’s proposal. Both approvals were subject to a long list of social and environmental conditions.

In November 2014, SBI signed a memorandum of understanding with the Adani Group for the loan of $1 billion for the Carmichael coal project. The loan would be one of the largest given by an Indian bank for an overseas project. Adani announced the loan at the G20 summit in Brisbane, Australia, which he was attending as part of a business delegation. “The MoU with SBI is a significant milestone in the development of our Carmichael mine,” Adani said at the summit. “It is a unique asset that lies at the heart of our investment in Queensland and Australia, and aligns perfectly with our clear vision for delivering energy security in the Indian market.” Though SBI defended the proposed loan at the time, the bank later distanced itself from the project as opposition to it grew and gained support from international financial institutions.

Around this time, environmental groups began challenging the project in court. In August 2015, the Australian Federal Court set aside the approval for the project, ruling that Hunt had not considered advice about two vulnerable species—the yakka sink and the ornamental snake—before approving the project. The case was filed by the Mackay Conservation Group, based in a city in Queensland by the same name. Tony Abbott, the then Australian prime minister, was quick to defend Adani, issuing a statement that the project was “vitally important.” He added, “If the courts can be turned into a means of sabotaging projects which are striving to meet the highest environmental standards, then we have a real problem as a nation.” By October, the federal government reapproved the project.

The next month, it came to light that Jeyakumar Janakaraj, the chief of Adani’s Australia operations, had previously been in charge of a mine in Zambia that allowed dangerous pollutants into a river. Weeks later, the Australian Broadcasting Corporation reported that the federal environment department had specifically sought information about the “environmental history of executive officers” in August, and that Adani had not disclosed Jankaraj’s history. In January 2016, the environment department ruled that Adani had committed a “mistake,” and decided against reviewing the approval. By April, the Queensland state government granted Adani the final environmental approval and mining leases for the coal mine.

That month, Adani also overcame another obstacle to its ambitious project—securing the consent of the Wangan and Jagalingou people, who are the traditional owners of the land surrounding the Carmichael mine. The indigenous tribal communities possess native title over the land, and the Australian law governing their rights over it—the Native Title Act—allows for non-owners to negotiate using the land through an Indigenous Land Use Agreement. But if the indigenous owners refuse the terms of a proposed agreement, the non-owner can apply to a National Native Title Tribunal for permission to proceed without their consent.

Adani proposed such land-use agreements to the Wangan and Jagalingou people on multiple occasions, which were rejected first in 2011, then in 2014, and again in 2015. According to a report in an Australian magazine The Monthly, in April 2016, a group claiming to represent the Wangan and Jagalingou people consented to a land-use agreement. The report further stated that the circumstances of this meeting are “highly contested” and that “those opposed to the mine insist it was illegally constituted and that many who attended were not eligible to vote.” As I earlier reported for The Caravan, Adani has previously been accused of subverting the processes that protect the rights of indigenous land owners for a coal mine in Hasdeo Arand, in Chhattisgarh, India. This included allegations that Adani had brought non-locals to a village to hijack a public hearing and secure the consent necessary to acquire their land.

Adrian Burragubba, a senior leader of the Wangan and Jagalingou people, challenged the 2016 land-use agreement. This was dismissed two years later, and in July 2019, the Federal Court dismissed the appeal. After the Wangan and Jagalingou people had rejected the 2014 land-use agreement, Adani had secured an order from a National Native Title Tribunal for the grant of mining leases. Burragubba had challenged this order in Federal Court as well, but it was rejected in August 2016. (Later that month, the Federal Court also dismissed another case against the mine by the Australian Conservation Foundation, which was premised on the effect it would have on the Great Barrier Reef.) Meanwhile, Adani instituted proceedings seeking $600,000 in costs from Burragubba personally. Adani has also moved the courts to silence other activists, even obtaining an injunction against one activist, Ben Pennings, from using “confidential material.”

Adani has enjoyed a lot of vocal political support through the years, most often citing the creation of over 10,000 jobs and economic growth through billions of dollars in tax revenue that the project would bring. But even these figures have been widely debunked. The Monthly reported that Jerome Fahrer, an Adani Group consultant and a former economist with the Reserve Bank of Australia, has “admitted the figure of 10,000 was ‘extreme and unrealistic.’” The Monthly added, “Instead, Fahrer argued that, at the peak of construction, the project would employ approximately 2400 people, but because many of these jobs would come at the expense of those elsewhere, the number of jobs actually created would be considerably lower.” Moreover, the Institute for Energy Economics and Financial Analysis, or IEEFA—a non-profit working towards the development of renewable energy—estimated that Adani would receive over $4.4 billion tax exemptions, deferrals and capital subsidies.

Yet, in October 2016, the state government declared the Carmichael mine a “critical infrastructure” project, which would help fast-track the remaining approvals for the project. The next month, the state passed new regulations on water usage with a last-minute amendment that exempted approved projects such as the Carmichael mine from the public-objection process. On 4 December, Adani had obtained approval for a permanent rail line. The next day, Adani went to Queensland to meet the state’s chief minister, Annastacia Palaszczuk, and announced that the mining giant would begin construction the following year.

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Despite the string of favourable decisions from the judiciary and the government, Adani’s project began losing corporate support, largely due to the anti-coal activism in Australia. By 2015 itself, international financial institutions such as HSBC, Morgan Stanley, Citigroup and Barclays had announced that they would not support coal projects in the Galilee Basin. In March 2017, several environmental groups including the Bob Brown Foundation, Australian Conservation Foundation, 350.org, Get Up and the Sunrise Project came together to launch the #StopAdani movement. The campaign was successful in forging an alliance of environment and community-based organisations across the country and has since grown to include over 70 groups, according to its website. The alliance called for the complete withdrawal of Adani’s Carmicheal mine and associated rail and port projects.

The anti-Adani campaign drew attention to the increasing global trend of transition to renewable energy that is pushing divestment from fossil fuel projects. It highlighted how countries are committing to zero-emission targets, in keeping with the Paris Agreement, and how global financial institutions are moving away from coal in Europe, North America and Australia. The campaign was instrumental in forcing the four major Australian banks—the National Australia Bank, the Commonwealth Bank, the Australia and New Zealand Banking Group, and the Westpac Bank—to not fund Adani and adopt stronger climate policies.

It led two of China’s biggest banks—the Industrial & Commercial Bank of China and the China Construction Bank—to issue statements that it would not fund the Carmichael mine. According to Tim Buckley, a director at IEEFA, almost every major financial institution in Australia now has a formal coal-exit policy. In November 2020, the CEOs of 22 of Australia’s largest companies announced that they would increasingly moving away from coal to lower carbon emissions.

The Adani Group is also being shunned by major insurance companies. In October 2020, the insurance company Apollo announced that it would stop insuring the Carmichael project after its ongoing policy expires in September 2021. In doing so, Apollo became the seventeenth firm attached to Lloyd’s of London—a British insurance market—and joined 27 other insurance companies that have ruled out working with Adani. By mid-2020, three major insurance companies which covered parts of the Carmichael project—AXA XL, Liberty Mutual and HDI Global—had announced that they will not have any future involvement with the Carmichael mine. On 17 December, Lloyd’s instructed its insurers to exclude new insurance for thermal coal mining, and phase out all existing cover for fossil fuels by January 2030.

In response to emailed queries, a spokesperson for Bravus Mining wrote, “We have the requisite insurance requirements in place for the Carmichael Mine and Rail Project.”

In addition to financial institutions, Adani has even found it difficult to obtain rail haulage service-providers to transport the coal. By late 2017, Adani was forced to announce that it was scaling down the project to produce around 27.5 million tonnes of coal, reduced from the initial 60 million. It also changed its rail project from a direct rail line from the mine to Abbot Point, with a shorter line that would use the existing infrastructure of the rail haulage company, Aurizon. But following an announcement last year by Genesee & Woming—one of Australia’s largest rail-haulage companies—to not work with the Adani Group, Aurizon and another haulage company, Pacific National, are under pressure to stop working with the company.

Struggling to secure funding and institutional support, Adani has been compelled to self-finance. In November 2018, the mining giant announced, “Adani Mining’s Carmichael mine and rail project will be 100 percent financed through the Adani Group’s resources.” In August 2020, the Bowen Rail Company, a subsidiary of the Adani Ports and Special Economic Zone—which is an Indian company of the Adani Group—announced that it was launching a rail haulage service to carry coal to the Abbot Point terminal.

“This is the first time in seven years that the Adani Ports and Special Economic Zone—a publicly listed Adani Group company—has become directly involved in funding their Australian debacle at Carmichael,” Buckley told me. “That raises the risk of the group because of the number of financial institutions who have ruled out financing any new coal.” Brait, the campaigner with Market Forces, told me, “Now we are reaching out to investors in Adani Ports like Alliance—the German insurer who owns bonds in Adani Ports—and explaining the link to the Carmichael mine and asking them to divest from the Adani Ports.” He added, “The Carmichael mine is really a burden to this group, because it is possible that the company’s mainstream investors will start diverting from the group’s other companies because of its link to the Carmichael project.”

It is in this context that news reports of SBI’s granting a $1 billion loan to Adani needs to be understood. Investors and insurers have pointed out that funding the project would affect the environmental, social and corporate governance (ESG) standing of the SBI. The ESG is a set of standards considered by socially conscious investors to screen potential investments, based on their polices on areas ranging from environment to labour practices. Moreover, the SBI’s own policies on sustainability do not align with its proposal to fund the coal mine.

In the bank’s Sustainability Report for the year 2019–20, the SBI chairman Rajnish Kumar wrote that it was committed to funding clean energy projects. Commenting on the global divestment from fossil fuel-based projects, he wrote, “SBI recognises the need for responsible financing and its invaluable role in effecting tangible and long-lasting positive change. To this end, it is making strategic investments and innovations that can help drive sustainable growth.” Kumar added, “SBI has also issued Green Bonds for refinancing eligible projects identified under the Bank’s Green Bond framework targeting significant emission reduction.” 

The report further acknowledged that it had “availed credit from the World Bank, KfW German Development Bank and European Investment Bank” to lend money to “sustainable businesses such as solar power generation, climate change mitigation and adaptation, affordable housing and energy efficiency.” It is unsurprising, then, that the bank’s involvement with the Carmichael project has given its investors pause for thought. The Stop Adani campaign is now targeting SBI’s investors that have ruled out funding the Carmichael project, such as HSBC, Deutsche Bank, and Credit Suisse. “If SBI provides $1 billion to Adani, as SBI investors they will be breaking that commitment,” Brait said.

On 16 December, the France-based global asset manager Axa Investment Managers announced that it had sold its green-bond holdings from the SBI, due to its loan to Adani to fund the Carmichael coal mine. An AXA spokesperson, who refused to disclose the scale of the disinvestment, stated to the media, “After having reviewed SBI’s environmental practices, we noticed their potential involvement in the Carmichael coal project in Australia. We were concerned with this kind of developments, which we consider to not be aligned with the necessary energy transition.”

Amundi, a French asset-management company, has also warned the SBI that it would sell off green bonds if SBI proceeds with the loan. “We’ve been extremely clear on the fact that, if they decide to do it, we would immediately disinvest,” Jean Jacques Barberis, a director at Amundi, told the media in November 2020. “The SBI has been tapping global debt markets, and raising green capital in particular,” Buckley told me. “By being involved in the Carmacheal project when over 150 global financial institutions have come out and said that they will not fund new coal projects, this will have serious implications on its global debt capital access.”

He continued, “Various global institutions asking the SBI to not give the loan is an embarrassment to the Indian government ahead of significantly increasing ambitions globally going into COP26.” He was referring to the 26th United Nations Climate Change Conference, scheduled to take place in November 2021. Buckley told me, “The SBI seems to have underestimated the fact that none of the global banks would touch the Carmichael mine and it is funding a project which is pretty much stranded.”

According to Brait, the Market Forces’ campaign to pressurise SBI to stop funding the mine has been gaining momentum. “It looks a lot like the SBI doing a favour to a well-connected billionaire rather than making a wise investment on behalf of the Indian people.” The SBI did not respond to queries on the status of the loan and how funding Carmichael would contradict with the bank’s sustainability commitments.. The report will be updated if and when a response is received.

Another reason why the SBI’s involvement with Adani’s project has come under fire is because the Carmichael coal mine will not even benefit India. The coal would be imported to India, burnt at the Godda thermal power plant in Chhattisgarh, and the electricity generated would be sold to Bangladesh. The plant is located in a special economic zone, which exempts Adani from coal import duties and certain other charges. According to a 2018 report by IEEFA, the power-purchase agreement between Adani and the Bangladesh government would lock the country into an expensive, long-term and emissions-intensive source of electricity for decades to come.

“I don’t think anyone will question India’s ongoing use of domestic energy, domestic resources as an emerging market,” Buckley told me. “But the SBI sort of crosses that threshold as it is not investing in India for the benefit of the Indian people but is investing in coal in Australia which would be imported, burnt in India and then sold to Bangladesh.”

The anti-Adani campaign has also highlighted the fact that SBI’s involvement in the loan would go against Modi’s advocacy for renewable energy. Buckley drew attention to the record-low tariff of Rs 2 per kilowatt-hour in a solar tender that the Solar Energy Corporation of India awarded in November 2020. “That means new solar costs in India are now below the marginal costs of existing coal power generation in India,” he said. “The SBI must think through the strategic implications of that record-low solar price before they grant loan to an expensive foreign coal project.”

The campaign has also argued that abandoning the project would benefit the company itself. “Adani is now aiming to be the biggest solar energy company in the world; even Adani seems to have realised that the future is in renewables,” Ed Hill, a campaigner with the environmental group Sunrise Project, told me. “There’s no future in coal, Adani and its investors would be wise to prepare a coal-exit plan that includes stopping the Carmichael project.” In fact, Adani’s fossil-fuel based power generation has been suffering heavy losses while the group’s renewable energy portfolio has seen record growth. A recent report by IEEFA analysing the Adani Group’s finances also concluded that there is a strong economic case for Adani to phase out its coal power in alignment with group’s ESG commitments and India’s renewable energy policy. 

One major factor that likely contributed to the decisions by companies to distance themselves from the project is the massive indebtedness of the complex corporate structure of the Adani Group’s Australian operations. The group had repeatedly figured in the Credit Suisse’s House of Debt list of India’s top over-leveraged corporate houses since 2012. Its debt had grown to Rs 1.28 lakh crore in 2019, according to a report published by BloombergQuint. In 2015, the SBI reportedly had an exposure of Rs 15,402 crore funded and Rs 4,327 crore non-funded to the Adani Group. In July 2019, the Australian Broadcasting Corporation reported that Sandra van der Laan, a forensic accounting specialist who teaches at the University of Sydney, found that the Adani Group has current liabilities of more than $1.8 billion versus current assets of less than $30 million.

The ABC report noted that the Adani group’s Australian operations involved “a labyrinth of trusts interposed between private companies and Indian stock market-listed companies with ties to, and in some cases ownership in, tax havens stretching from Singapore to Mauritius, on to the Cayman Islands and the British Virgin Islands.” Van der Laan told ABC that “the structure of Adani seems to be developed to obfuscate or confuse or to hide things.” She added that the Carmichael coal mine was surviving on lifeline from Indian parent company.

The Adani group denied all the allegations raised in the report. In response to my queries about the report, a Bravus Mining spokesperson wrote, “The media article you have referenced is almost 18 months old. The article included interviews with Professor Sandra van der Laan and IEEFA … IEEFA is well-known for publishing alarmist papers that attempt to discredit the fossil fuel industry using flawed analysis in order to achieve its stated aim of transitioning to renewable energy.”

According to Buckley, “The lack of transparency and the complexity of the corporate, particularly here in Australia, is very, very problematic for the group and for the SBI.” He explained that Adani’s corporate structure goes through “multiple tax havens” and its “Australian business have liabilities of two billion already and it has negative shareholder’s equity of more than 700 million Australian dollars.” Buckley continued, “How could the SBI lend to someone who has negative shareholders equity, no revenue and a multi-billion dollar of debts before they have even invested in this mine? The lack of transparency about inter-company transactions and the excessive complexity of the corporate structure—that is a major red flag for the international investors shareholders.”

Tracing the developments of the project till now reveals that more than the financial viability and benefits of the project, it is Adani’s political and pro-coal lobbying in both India and Australia that has helped the project to move ahead. Modi has never shied away from flaunting his proximity to Adani, which has been cited as a major reason for the group’s meteoric rise since Modi became the chief minister in Gujarat in 2001.

In August 2015, The Guardian detailed how Adani had courted Australian politicians in an article titled, “Private dinners, lavish parties and shoulder rubbing: How coal giant Adani charmed Australia’s political elite.” The report noted that in October 2010, the former Queensland premier Anna Bligh met Adani and his international development executive, Harsh Mishra. When Campbell Newman took over as premier, he, too, met Adani as part of a 76-member business delegation touring Adani’s port, followed by a lavish reception at his home. During Modi’s visit to Brisbane for the G20 summit, he had attended a breakfast meeting with Campbell Newman, the chief minister of Queensland at the time, with Gautam Adani and Arundhati Bhattacharya, the former chairperson of SBI.

In 2013, the former deputy premier of Queensland, Jeff Seeney, met Mishra when he visited India on a trade mission, and visited an Adani port and power station. Later that day, The Guardian reported, Seeney met Adani and Modi, and had dinner with Adani Group senior executives and the industrialist’s family members at his house. In June 2015, Adani accompanied Modi when he travelled to Dhaka to meet the Bangladeshi prime minister, Sheikh Hasina, and pitched for Indian power companies. Two months later, Adani Power Limited signed a memorandum of understanding for exporting electricity generated at its Godda power plant.

In March 2017, Palaszczuk, Queensland’s current premier, travelled to Gujarat along with mayors from the state to visit Adani at his Mundra port. Following the visit, the company issued a statement noting that the premier had reaffirmed her support for the Carmichael project, and quoting her saying, “My visit here shows that Queensland supports the Adani project for its potential to create many job.” 

“I can see this as Indian cronyism meeting Australian cronyism,” Quentin Beresford, a professor of politics and public policy at Edith Cowan University, in Perth, and the author of the book Adani and the War over Coal, told me. “The whole history of the mine, it seems to me, is about crony politics—the very close relationship developed between the resource sector in India and in Australia. It doesn’t surprise me that that the SBI will be funding the project.” He added, “The SBI is doing this when no major bank who has concern for its reputation would not back this mine. This seems to be like a predictable but regrettable development.”

In their response to emailed queries, the Bravus Mining spokesperson wrote, “As the world’s number one international solar company and India’s largest private electricity generator, Bravus’ parent company, the Adani Group, has a unique view of the market and we see there will be a need for both coal and renewables in the energy mix to meet growing energy demand in Asia as people there emerge from poverty.”

The spokesperson added, “The process of mining 10 million tonnes of coal per annum at the Carmichael mine will produce 240,000 tonnes of carbon dioxide emissions,” stating that it would “represent less than 0.04% of Australia’s emissions and less than 0.0006% of global emissions.” But John Quiggin, a professor of economics at the University of Queensland, has disputed this claim. “This is semantic trickery,” Quiggin wrote. “The firm is referring only to so-called ‘scope 2’ emissions associated with the mining process itself. When the coal is burned it might produce an extra 30 million tonnes of carbon dioxide, amounting to about 0.05% of global emissions.”

The spokesperson also argued that if Adani did not produce that coal, India would obtain lesser quality coal from elsewhere. “The quality of coal from the Carmichael Mine is better than the coal it will replace in the market, meaning it will produce fewer emissions when burnt to produce electricity,” the spokesperson wrote. “What’s more is if Bravus does not provide coal to India, other countries’ coal suppliers are ready to fill the gap with coal of a lesser quality in comparison to ours.” But in April 2017, ABC reported that sworn evidence filed by an Adani official in a Queensland court stated that the Indian mining giant would be shipping low-grade coal to India.

In a defiant note, the spokesperson added, “Work on the Carmichael Mine and Rail Project commenced in June 2019 and construction activity is now at peak level with more than 2,000 people employed. While activist groups said that the project would never go ahead, we have proved those opponents wrong and remain on track to producing first coal in 2021.”

The increasing incidents of heat wave, drought and bush fires in the country have contributed to an increasing concern about global warming among Australians, and in the past few years, the Carmichael coal has become an election issue. Media reports have highlighted the Adani project’s contribution to the re-election of Palaszczuk in the Queensland elections, in 2017, and to the state's support for the pro-coal prime minister Scott Morrison, who returned to power in 2019. “The issue of Adani’s coal is so politically controversial that no major party wants to talk about it,” Hill, from the campaigner with the Sunrise Project, told me. “The government is backing Adani; but the project lacks support from the private sector because of the controversial and environmentally destructive nature of the project. The financial sector is beginning to act on climate change because it’s in their economic interests to act, the government is holding back the inevitable action on climate change that the private sector is beginning to embrace.”

According to Hill, even with the SBI loan, there would be many more hurdles for the project. “They have already spent more than five billion dollars and ten years later they have not produced any coal or even built the rail line for coal haulage,” he said. “There are legal challenges and there is a really strong and active movement in Australia that opposes the mine.”