Australia: George Christensen backs $1bn federal loan for Adani railway line
By Gareth Hutchens From The Guardian UK
The conservative backbencher George Christensen has backed the idea of the controversial mining company Adani getting a $1bn loan from the Turnbull government for a rail line in his Queensland electorate.
But an analyst has warned the government would have to conduct strict due diligence to ensure the loan was not funnelled through the Cayman Islands tax haven.
As Malcolm Turnbull met the Adani Group chairman, Gautam Adani, in Melbourne on Monday to discuss the project, more than 300 people rallied in the city to protest against the plan to help fund the 388km railway line.
Adani’s proposed line, belonging to the group’sCarmichael rail project, would link the Galilee basin in Queensland to a new terminal at Abbot Point port to help it ship thermal coal to India.
Matt Canavan, the minister for northern Australia, confirmed on Monday that the government was considering lending $1bn towards the rail project.
But he said the proposal was still before the independent panel of the National Australia Infrastructure Fund, which would make a final recommendation to government on whether or not to support it, and the final decision could be months away.
A spokeswoman for the prime minister would not say what was discussed at the Melbourne meeting.
Christensen wrote on his Facebook page on Monday that he “fully supported” the loan plan.
“The NAIF was established to support multi-user infrastructure that will enable economic expansion and employment in the North,” he wrote. “Adani’s railway line ticks all of those boxes.”
But Tim Buckley, an analyst from the Institute for Energy Economics and Financial Analysis, warned the NAIF and federal government would have to be mindful of the entity receiving the loan.
According to the Australian Securities and Investments Commission, the corporate structure of Adani’s Australian operations was extremely complicated, he told Guardian Australia. “The rail project is not part of Adani Mining Pty Ltd, it’s a completely separate proposal,” he said.
Buckley said it was unclear which company NAIF was considering lending money to. It could be Carmichael Rail Holdings, Carmichael Rail Network, Carmichael Rail Network Holdings or Carmichael Rail Pty Ltd, he said.
“Any one of those you would think would probably be the Carmichael railway line, unless they got the names wrong by accident,” he said.
“But [according to] Asic’s reports, you’ll find that the parent company is a Singapore tax haven-based entity, Carmichael Rail Singapore, and then above that … you end up in Atulya Resources Limited, which is a Cayman Islands tax haven-based company.
“And that is the parent entity of the Adani family company, according to reports lodged.”
Ben Oquist from the Australia Institute said the NAIF process lacked transparency and basic questions about its funding guidelines and mandateought to be answered.
“Any private-sector project can be made commercial if you throw enough government money at it,” he said. “The Adani project is already an environmental nightmare we should not let it become a taxpayer-funded economic disaster as well.
“Subsidising infrastructure for an unviable and foreign-owned mining project will inevitably mean more worthy local investments will miss out.”
IMAGE: Climate activists protest about the planned loan to Adani in Melbourne on Monday. Photograph: Julian Smith/AAP
For more on this story go to: https://www.theguardian.com/environment/2016/dec/05/george-christensen-backs-1bn-federal-loan-for-adani-railway-line
