Adani's $108 billion crisis shakes investors' faith in India.

ISLAMABAD -- A short seller attack on the Adani conglomerate raises bigger, darker questions about India's credibility as a destination for global investors.

Just 10 days ago, Gautam Adani and his sprawling energy-to-ports empire looked invincible. Now, a damning short-seller attack has left the billionaire battling the worst crisis of his corporate life - and is raising bigger, darker questions about India's credibility as a global growth engine and a destination for international investors.

According to an article published on Bloomberg website, the Adani Group has shed $108 billion in market value since Hindenburg Research accused it of stock manipulation and accounting fraud in a Jan. 24 report. But it was only when the tycoon scrapped a $2.4 billion share sale this week that the potential for lasting impact became clear. Adani's rebuttal had failed to reassure investors. Once ranked No. 2 among the world's wealthiest, he has tumbled to No. 21 on the Bloomberg Billionaires Index.

The small, but famed, US short seller has revived old doubts about corporate governance at the Adani conglomerate. The fallout from its almost 100-page report threatens to undermine investor confidence in India more broadly, and in the nation's regulatory framework - whether its claims ultimately prove to be true or not.

'Things are moving very fast in the market, with a potentially major reassessment of the risks of investing in Indian equities by international investors,' said Singapore-based Gary Dugan, chief executive officer of Global CIO Office, an asset manager and financial advisory firm. 'That reassessment includes governance, corporate transparency, nepotism and indebtedness.'

Adani, 60, has been close to Prime Minister Narendra Modi for decades. And his business - with investments in capital-intensive projects such as airports, power plants and data centers - is at the heart of Modi's growth agenda. As a national champion, the tycoon has aligned his business interests with Modi's development goals, often stepping in where the state lacks resources or competence, helping create thousands of jobs.

If the slide in asset prices continues and further shakes investor confidence in Adani's empire, that would be a setback for India's growth story at a pivotal time. Banks like HSBC Holdings Plc and companies like Apple Inc. are expanding in India to hedge their exposure to China.

'The truth is that Adani's scandal is not coming at the best of all times for...