On Tuesday, shares of Adani group companies rallied up to 20%, with flagship firm Adani Enterprises closing up to 17% from its previous close on BSE. This marks a significant bounce back for the conglomerate, which has been struggling since the beginning of the year amid allegations by American short-seller Hindenburg Research.

So, what led to this rally? On Tuesday, Bloomberg reported that US government agency International Development Finance Corporation (DFC) provided financing to the conglomerate for the Sri Lanka port terminal after concluding that Hindenburg’s allegations against the group were “not relevant”.

First, some background. In January, Hindenburg had released a report accusing the Adani group of accounting malpractices, improper use of tax havens and stock manipulation while flagging high debt levels. This led to a market rout, which wiped off over $100 billion from its companies’ valuation. In addition to the long list of allegations that the Gautam Adani-led conglomerate faces back at home (read this, this and this), critics have also alleged that the billionaire has been sealing overseas port deals—including those in Sri Lanka and Israel—because of his closeness with Prime Minister Narendra Modi.

But then, last month, in a major turn of fortunes for Adani, the DFC pledged $553 million in funding for the Colombo West International Terminal project in Sri Lanka—as part of its efforts to curtail China’s growing influence in the island country. The US government backing an Adani project is a first. For the conglomerate, the financing came as “a reaffirmation by the international community” and “a ringing endorsement of the Adani group”.

To be clear, the DFC loan will be granted to a consortium developing the deep-sea container terminal in Colombo—51% of which is owned by Gautam Adani-led Adani Ports & Special Economic Zones (APSEZ); 34% by Sri Lanka’s John Keells Holdings; and the remaining by Sri Lanka Ports Authority.

Now, coming back to the DFC, an official from the US agency told Bloomberg that the agency conducted a due diligence investigation and found that the accusations in the short-seller’s report did not apply to APSEZ. However, the American agency will continue to monitor the ports-to-power conglomerate to prevent unintentional support for misconduct.

Adani Green secures $1.36 bn funding: As shares rallied on Tuesday, leading the pack was Adani Green Energy, which closed at Rs 1,348 on BSE, up nearly 20%. For Adani Green, however, the surge was because of an announcement it made during the day.

The firm said in an exchange filing that it has secured an additional $1.36 billion funding through a senior debt facility. This marks the largest project financing as part of its “construction financing framework” to date and takes the total funding pool to $3 billion, the company said in the filing.

Senior debt is secured by a business for a set interest rate and time period, and is generally funded by banks. A consortium of eight international banks participated in this transaction, including BNP Paribas, Coöperatieve Rabobank U.A, DBS Bank, Intesa Sanpaolo, MUFG Bank, Societe Generale, Standard Chartered Bank and Sumitomo Mitsui Banking Corporation.

Additionally, this green loan facility will be used towards developing the “world’s largest renewable energy park at Khavda in Gujarat”. “The world’s largest RE park at Khavda will not only enable AGEL’s vision of 45 GW operating renewable capacity by 2030 but will also play a critical role in India’s net zero journey,” the company said in the filing.

Read all of The Morning Context’s coverage on the Adani group here.