The recent executive order signed by US President Donald Trump, which pauses the enforcement of the Foreign Corrupt Practices Act (FCPA), has sent shockwaves through global business and legal communities. The decision will have far-reaching global implications, and impact several ongoing investigations being undertaken by US enforcement authorities. For instance, the probe against India’s Adani Group could also be affected, thus the move has been met with mixed reactions. While it offers a temporary reprieve to the Indian conglomerate, it also raises serious questions about US legal standards, foreign policy priorities, and the future of anti-corruption enforcement. At the centre of this move is the 1977 Foreign Corrupt Practices Act, which bars American companies and foreign firms with ties to US financial markets from engaging in bribery overseas. This law has been instrumental in holding global corporations accountable for illicit financial activities involving foreign officials. The Adani Group, one of India’s largest corporate entities, was facing allegations under this act for allegedly paying $250 million in bribes to secure solar power contracts. The US Department of Justice (DoJ), under President Joe Biden’s administration, had initiated criminal proceedings, citing fraudulent activities that concealed vital financial information from US investors and banks. Trump’s decision to halt FCPA enforcement for a 180-day review period changes the landscape dramatically. While the official justification is to reevaluate the scope and enforcement practices of the law, many see this as a politically motivated move—one that could serve to reset US-India diplomatic ties while also shielding influential business figures from legal scrutiny. The question that arises, however, is whether this move serves the broader interests of justice or merely emboldens corporate misconduct.
The pause on FCPA enforcement could have far-reaching implications for Indo-US relations. The Adani case had become a flashpoint in diplomatic corridors, with several US lawmakers writing to the new Attorney General, Pamela Bondi, expressing concerns over the DoJ’s pursuit of Indian corporate executives. Their argument was simple: prosecuting an Indian company for actions that allegedly took place within India involving Indian officials should have been left to Indian authorities. They further accused the Biden administration of making “questionable legal decisions” that jeopardized strategic ties with New Delhi. India and the US have, in recent years, forged a strong economic and strategic partnership, one that extends beyond trade into defence, technology, and counterterrorism cooperation. Given this backdrop, the indictment of a major Indian business group risked creating tensions between the two allies. Trump’s intervention is, therefore, being interpreted by many as an attempt to course-correct US-India relations, ensuring that legal disputes do not interfere with broader geopolitical objectives. While some celebrate this move as a diplomatic win for India, others worry about the dangerous precedent it sets for corporate accountability. The FCPA has, for decades, played a pivotal role in deterring corrupt business practices in the global economy. If its enforcement is weakened, even temporarily, it could encourage corporations to act with impunity, knowing they may face fewer legal consequences for bribery and fraud.
Moreover, the review period of 180 days could lead to policy changes that permanently dilute the FCPA’s effectiveness. Trump’s directive instructs the Attorney General to evaluate whether past investigations were appropriate and to determine whether certain cases—including those like Adani’s—should be reconsidered. This opens the door for potential dismissals of pending cases, effectively letting corporations off the hook for past misconduct. It is difficult to ignore the political undertones of Trump’s decision. Since announcing his re-election campaign for 2024, Trump has aggressively sought to reverse many of Biden’s policies, especially those that he perceives as damaging to American business interests. The FCPA, despite its noble intentions, has often been criticized by conservative lawmakers and corporate lobbyists for placing American companies at a competitive disadvantage globally. By pausing its enforcement, Trump signals his alignment with the corporate world, reassuring businesses that his administration will prioritize economic pragmatism over legal purism. This approach, however, is not without risks. It undermines the US’s credibility in the fight against global corruption and could lead to other nations weakening their own anti-corruption laws in response. For India, the temporary relief for the Adani Group is significant, particularly given the political and economic influence of the conglomerate. The case had the potential to disrupt India’s clean energy sector, as Adani is one of the largest investors in renewable energy projects. Additionally, it could have strained India’s access to US financial markets, as allegations of fraud involving US investors might have led to stricter financial scrutiny of Indian firms. However, India must tread cautiously. Celebrating this pause without addressing the underlying concerns of corporate ethics and governance could be short-sighted. If corruption allegations persist, they could damage investor confidence, not just in Adani but in India’s broader business ecosystem. Transparency and accountability remain key pillars of India’s economic rise, and shielding companies from international scrutiny may not serve long-term national interests. Trump’s pause on FCPA enforcement offers short-term relief to the Adani Group and potentially strengthens US-India relations. However, it also raises fundamental questions about the global fight against corporate corruption. The temporary suspension of FCPA cases could incentivize unethical business practices, weaken international legal cooperation, and create loopholes for financial fraud. The focus must remain on ensuring corporate transparency while leveraging diplomatic wins strategically. While this executive order may serve immediate interests, it must not be seen as a license for unchecked corporate behaviour. Ultimately, whether this move strengthens or weakens global legal norms will depend on what happens after the six-month review period. If the US reinstates FCPA enforcement with clearer guidelines, it may strike a balance between protecting business interests and upholding legal integrity. If, however, this leads to permanent dilution of anti-corruption laws, it could mark a dangerous turning point in the global regulatory framework—one where business interests take precedence over ethics and justice.