OPINION

India’s Corporate State? The Growing Nexus of Modi, Adani and Reliance Over Strategic Assets

India’s rapid infrastructure boom has lifted the nation onto the global stage, but a deeper story is emerging: a handful of conglomerates—most notably the Adani Group and Reliance Industries—are repeatedly capturing the country’s most strategic resources. Critics argue that this pattern signals a shift toward crony capitalism, raising fundamental questions about the health of India’s democracy.

By Open Vaartha Desk · 2026-08-12

What happened

TL;DR

India’s strategic assets are increasingly concentrated in the hands of a few conglomerates close to power, raising serious democratic and competition concerns.

Key points

Adani won all six airports in the 2019 privatization despite internal government objections
Reliance’s Jio leveraged government‑allocated spectrum to dominate telecom
February 2026 Reuters report: Adani and Reliance plan ~US$210 billion in AI and data‑centre investments
Crony capitalism is defined by systemic access to public resources, not just direct favoritism
Concentration creates a self‑reinforcing loop of financial strength and further public‑asset capture

India’s economic transformation over the past decade is undeniable. Massive infrastructure projects, a sweeping digitalisation drive, and the rise of globally significant corporations have reshaped the nation’s growth narrative. Yet beneath the headline‑grabbing successes lies a quieter, more consequential development: the systematic transfer of control over strategic economic assets to a small circle of private conglomerates that enjoy unusually close ties to political power.The pattern over individual dealsProponents of the current model often point to isolated successes. Adani’s win in an airport auction is summed up by the simple claim, “He submitted the highest bid.” Reliance’s launch of Jio is celebrated for its “billions of dollars” investment that “transformed telecom.” And Adani’s expansion into renewable energy is framed as a contribution to India’s energy goals. Each of these statements can be factually correct, but they miss a crucial analytical layer: why the same two conglomerates repeatedly emerge as the primary beneficiaries whenever the government opens a new strategic sector to private capital.Government‑controlled resources and the concentration riskThe Indian state controls access to a suite of high‑value resources—airport and port concessions, spectrum, mining rights, electricity projects, transmission networks, land, renewable‑energy licences, infrastructure contracts, manufacturing incentives, and public‑sector financial exposure. When these opportunities consistently accrue to a handful of firms, economic power becomes concentrated, and that concentration inevitably carries political consequences.Adani‑Modi relationship: a case studyGautam Adani’s political rapport with Narendra Modi dates back to their shared tenure in Gujarat. The relationship intensified after Modi became prime minister in 2014, a period that coincides with Adani’s dramatic expansion into sectors heavily dependent on government policy and public infrastructure. The Financial Times documented this “extraordinary expansion” and highlighted Adani’s growing reliance on government tenders. While it is not proven that Modi personally awarded every project, the proximity between the two created an environment where Adani was exceptionally well‑positioned to capture government‑created opportunities.The six‑airport episode (2019)In 2019 the government moved to privatise six airports. The Department of Economic Affairs in the Finance Ministry and NITI Aayog both raised concerns about allowing a single bidder to acquire too many airports. Those objections were ultimately overruled, and Adani won all six concessions. The Indian Express reported that internal documents showed the raised concerns and the subsequent decision to ignore them. The episode illustrates a democratic red flag: internal safeguards flagged concentration, yet the policy safeguards were not applied.The competition feedback loopWhen a firm secures a long‑term concession, the resulting cash flow strengthens its balance sheet, enabling cheaper borrowing. That financial muscle makes it easier to win the next round of government tenders, creating a self‑reinforcing cycle: public asset → private concession → cash flow → financial strength → more acquisitions → greater market power → greater ability to capture future public assets. Over time, competitors are not just facing a single firm but an ecosystem of capital, infrastructure, political access and scale.Defining crony capitalismCrony capitalism should not be reduced to the notion that “the Prime Minister personally ordered a contract to a friend.” Instead, it describes a broader political‑economic system where connections, access and proximity to power shape who receives privileged access to government‑controlled opportunities. The state remains the custodian of resources such as airports, spectrum and ports; the danger lies in private firms becoming de‑facto gatekeepers of those resources.Reliance Industries: a parallel trajectoryReliance was already a massive corporation before 2014, but its transformation through Jio involved massive capital deployment, technological ambition and commercial risk. Spectrum—a public resource—was allocated by the government, and Reliance leveraged its financial depth to dominate the telecom market. In February 2026, Reuters reported that Reliance and Adani together announced roughly $210 billion of investment in AI and data‑centre infrastructure, positioning both firms to benefit from India’s push for domestic AI capabilities. While not proof of favoritism, the case underscores how India’s industrial policy increasingly leans on the same conglomerates to build next‑generation strategic infrastructure.Democratic implications of concentrated controlA handful of corporations controlling ports, airports, electricity, telecommunications, energy, logistics and data infrastructure become more than product sellers; they become gatekeepers. Economic power of that magnitude can translate into political influence, creating a circular dynamic: political power creates economic opportunities, which create corporate power, which then shapes political decisions. The concern is not the wealth of Ambani or Adani, but the erosion of democratic safeguards that should grow stronger as firms become larger.Public resources becoming private economic powerConcessions grant private firms the economic rights to exploit assets for decades, even if formal ownership remains with the state. This shift means that the economic value of strategic resources increasingly flows through private corporations, a reality that should be at the centre of India’s democratic debate.The polymer‑banknote illustrationRecent approval of trials for polymer ₹10 and ₹20 notes sparked speculation about Reliance, one of India’s largest polymer producers. However, the contracts concern specialised banknote‑grade polymer substrate, not generic polymer. The proper investigative lens should ask who is eligible, who is bidding, what technical specifications were set, who supplied those specifications, and who ultimately receives the contract.What India needs to safeguard its democracy<ol><li>Strict concentration limits – No single conglomerate should amass excessive control over strategically important infrastructure.</li><li>Full disclosure of tender design – Eligibility criteria and tender structures must be publicly visible.</li><li>Independent regulatory institutions – Regulators must be empowered to challenge powerful firms without political pressure.</li><li>Parliamentary scrutiny of major concessions – Strategic assets should not disappear into long‑term private hands without meaningful oversight.</li><li>Transparent political relationships – Donations, meetings and government‑business interactions should be disclosed to the maximum extent possible.</li><li>Robust competition policy – Beyond technical compliance, the policy must assess whether cross‑sector concentration creates excessive economic power.</li></ol>The uncomfortable crossroadsIndia can either nurture powerful domestic champions that compete globally, or it can allow a small number of conglomerates to become entrenched gatekeepers of the nation’s strategic resources—an outcome that threatens both healthy capitalism and a vibrant democracy. The warning of crony capitalism is not an insult; it is a call for rigorous public scrutiny before economic concentration becomes irreversible.ConclusionThe convergence of political proximity and corporate expansion in the cases of Adani and Reliance signals a structural shift that merits aggressive democratic investigation. Legality alone is insufficient; genuine competition, transparency, independent regulation and parliamentary oversight are essential to ensure that India’s economic rise does not come at the cost of democratic equality.