India’s Finance Ministry Confirms State-Owned LIC Poured Billions More Into Adani Companies in 2025

Government says insurer acted independently and followed due diligence, but opposition lawmakers raise questions about risk to policyholders amid lingering scrutiny of Gautam Adani’s conglomerate

NEW DELHI: India’s government confirmed Monday that the Life Insurance Corporation of India, the country’s giant state-owned insurer, invested an additional 5,000 crore rupees ($580 million) in the Adani Group in May 2025 — even as U.S. regulators continue to investigate the conglomerate for alleged bribery and fraud — bringing LIC’s total exposure to the group to nearly 48,285 crore rupees ($5.6 billion).

In a written reply to a starred question in the Lok Sabha, Finance Minister Nirmala Sitharaman disclosed that LIC subscribed to secured non-convertible debentures issued by Adani Ports and Special Economic Zone Ltd. (APSEZ) after conducting “due diligence following established Standard Operating Procedures (SOPs) as per their Board approved policies.”

Details of LIC’s Investment

The fresh 5,000-crore-rupee investment in APSEZ debentures pushed the insurer’s debt exposure to that single Adani company to 9,626 crore rupees as of Sept. 30, 2025, making Adani Ports the fifth-largest private-sector borrower from LIC, according to the annexures tabled in Parliament.

Overall, LIC’s combined equity and debt holdings in nine Adani Group companies — including the recently acquired cement giants Ambuja Cements and ACC Ltd. — stood at 48,285 crore rupees on Sept. 30, 2025, up dramatically from just 2,042 crore rupees on April 1, 2007.

The largest equity stakes are in Adani Total Gas Ltd. (8,647 crore rupees), Adani Enterprises Ltd. (8,471 crore rupees), and Ambuja Cements Ltd. (5,788 crore rupees).

Due Diligence and Regulatory Context

Sitharaman emphasized that “Ministry of Finance does not issue any advisory/direction to LIC in connection with matters related to investment of LIC fund.” She said investment decisions are taken by LIC alone and are governed by the Insurance Act, 1938, and regulations from the Insurance Regulatory and Development Authority of India (IRDAI), the Reserve Bank of India, and the Securities and Exchange Board of India (SEBI).

The reply noted that LIC’s investment functions are audited by concurrent auditors, statutory auditors, system auditors, internal financial control auditors, and the corporation’s vigilance team, with periodic inspections also conducted by IRDAI.

No Ministry Interference, Government Insists

“There is no direct oversight by Government on investments made by LIC,” the written reply stated flatly, rebutting suggestions that the finance ministry or the Department of Financial Services had nudged the insurer toward Adani companies.

LIC’s broader portfolio, the government added, remains heavily tilted toward India’s largest listed companies: 45.85 percent of its total equity book value of 9.39 lakh crore rupees is invested in Nifty 50 constituents, led by Reliance Industries Ltd. (40,901 crore rupees) and Infosys Ltd. (38,846 crore rupees).

Historical and Financial Data

LIC’s relationship with the Adani Group dates back at least to 2007, when its holdings were limited to a modest 176 crore rupees in what is now Adani Ports and a 50-crore-rupee debt position in the erstwhile Adani Exports Ltd.

The sharp increase in exposure accelerated after Adani acquired Ambuja Cements and ACC in September 2022 and has continued through 2025. Among private-sector companies, Adani Total Gas now ranks 25th and Adani Enterprises 27th in LIC’s equity portfolio — well behind blue-chips such as Reliance, Infosys, TCS, and HDFC Bank, but still significant in absolute terms.

Political Background

The question was jointly posed by Dr. Mohammad Jawed of the Congress party and Mahua Moitra of the Trinamool Congress — two vocal opposition lawmakers who have repeatedly pressed the government on the Adani Group’s access to public-sector finance following Hindenburg Research’s January 2023 report alleging stock manipulation and accounting fraud (allegations the conglomerate has denied).

The latest disclosure comes at a sensitive moment: U.S. prosecutors indicted Gautam Adani and seven others in November 2024 on charges related to an alleged multibillion-dollar bribery scheme, charges that Adani has called “baseless.”

Implications for Markets and Policyholders

LIC, with more than 300 million policyholders and assets exceeding $550 billion, is India’s largest domestic institutional investor. Any significant loss in its portfolio could affect millions of ordinary Indians who rely on the insurer for life-cover payouts and retirement savings.

While the government reply stresses robust governance and independence, the steady buildup of exposure to a single conglomerate still under international regulatory scrutiny is likely to fuel continuing parliamentary and public debate over risk concentration, institutional autonomy, and the balance between commercial decision-making and perceived political proximity in India’s financial system.