Corporate Grapevine     

Published: May 15, 2025
Updated: May 15, 2025

RBI ‘Modi-fies’ stand on SP’s fund quest

In a surprising volte-face, the Reserve Bank of India has approved the Shapoorji Pallonji group’s proposal to raise $ 3.3 bn by pledging shares in Tata Sons as collateral. Until recently, the central bank had objected on the grounds of the group’s weak net worth and the foreign nature of the funding.

What prompted the change of heart? Insiders suggest that the SP group escalated the matter to the highest levels of the Modi government, leveraging its track record on high-profile infrastructure projects — including the construction of the revamped Central Vista and the new Parliament building. These credentials appear to have won it a sympathetic ear.

Notably absent was any support from the Tata group, which has so far resisted listing Tata Sons — an act that would significantly bolster the SP group’s liquidity options. Instead, the embattled conglomerate is now pursu ing expensive offshore debt to refinance existing obligations.

The episode underscores both the political currents that can influence regu latory decisions in India and the finan cial tightrope the SP group continues to walk.