US, Norwegian investors press SBI over loan to Adani coal mine in Australia



Shareholders of India’s largest bank are raising concerns about a proposed loan to Ltd. to help fund the opening of the controversial Carmichael coal mine in northern Australia.


Officials from New York-based Inc. and Norway’s Storebrand ASA have contacted the State Bank of India, which is majority-owned by the Indian government, about the loan. The loan’s value is expected to be as much as 50 billion rupees ($678 million), according to Indian media reports.





The Carmichael mine has been the focus of environmental protestors since it was proposed in 2010, with demonstrations most recently at a Nov. 27 cricket match in Sydney between Australia and India. Adani changed its trading name in Australia to Bravus Mining and Resources last month, possibly to help dampen controversy about the mine, which is located in Galilee Basin in the northeastern Queensland province. The project has become a target of anger from climate-change activists in the country, which saw record temperatures and widespread wildfires this year.


“Financing new coal plants is clearly not part of a sustainable future,” Andreas Bjørbak Alnæs, senior sustainable investments adviser at Storebrand, said in an emailed statement.


BlackRock, which holds shares of both Adani and SBI, has met with the companies tied to the Carmichael project and raised its objections because the plan has ESG-related risks, according to a person familiar with the matter, who declined to be identified because the conversations are private. In February, rebuked Siemens AG for similar reasons when it signed an 18 million-euro ($21.8 million) contract to provide rail-signaling systems for the mine.


An official, who declined to be identified, questioned the criticism of the bank given the mine’s license was officially approved by the Queensland government last year. The bank’s press office did not immediately respond to a request for comment on the loan.


“Surely the State Bank of India can see that for both economic and climate reasons, the time for building massive new thermal coal mines has well and truly passed,” said Pablo Brait, a campaigner at the activist group Market Forces. “India, like Australia, is already grappling with the disastrous impacts of climate change and Adani’s mega-mine will make climate change worse.”


Officials from BNP Paribas Asset Management met with their counterparts on Tuesday, according to stock-exchange filings in India. A spokesperson for BNP Paribas declined to disclose details of the meeting.


Amundi Asset Management has said it may sell SBI’s green bonds if the Adani loan goes ahead. It held about $21 million of the bonds in its Amundi Planet Emerging Green One fund as recently as June.


The Queensland government approved a scaled-back plan for the mine in June 2019 after about a decade of challenges from environmental groups. originally offered a memorandum of understanding for a loan to Adani in 2014 and then backed away as the project got more politically controversial.

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