Bangladesh government is at loggerheads with the Adani Power Plant in the Indian state of Jharkhand over a deal on import of power from the plant.
Bangladesh has signalled that it could scrap the controversial power purchase agreement with the Adani Power Limited, a subsidiary of the Indian conglomerate Adani Group led by billionaire Gautam Adani, following a National Committee鈥檚 initial findings of massive irregularities and frauds in the power purchase deal recently.
The latest stance from Dhaka came amid threats by the Adani Power Limited to suspend supply of about 1,400 megawatts of power from November 11 unless clearing of outstanding payment of about $496 million.
Energy, power and mineral resources adviser Muhammad Fouzul Kabir Khan on Tuesday said that the Adani Power Limited had also given such threats in the past, but did not suspend the supply.聽聽
鈥楽till, we are looking into it,鈥� said the adviser.
In June, Bangladesh cleared $437 million dues following assurance by the Adani Power Limited to re-negotiate the power purchase agreement under which Bangladesh Power Development Board buys per unit of electricity at Tk 16, at least Tk 2 higher than the prices of coal-based power generated by other private companies in the country.
Instead of re-negotiation, the Adani Power Limited has shown disposition towards an international arbitration process to resolve disputes over power supply payments by the Bangladesh Power Development Board.
The energy adviser said they would not veer away from the arbitration process when it will come at their way.
Regarding possible arbitration, the Adani Power Limited has already requested the Power Development Board to appoint an expert on mediation process to the Singapore International Arbitration Centre.
But the Power Development Board that had engaged in extensive discussion with the Adani Power Limited for amending the power purchase agreement favouring the power seller disproportionately dismissed the request.
It viewed the proposed mediation inappropriate because of complexities of the ongoing dispute over power purchase agreement now being examined by the National Committee under a directive by the High Court of Bangladesh.
Headed by retired High Court Division judge Moinul Islam Chowdhury, the five-member committee submitted its initial report on Monday after reviewing contracts signed under the Speedy Increase of Power and Energy Supply (Special Provisions) Act, 2010, during the Awami League regime which was ousted on August 5, 2024, in the wake of a mass uprising.
The interim government that assumed power on August 8, 2024, cancelled the controversial Speedy Increase of Power and Energy Supply (Special Provisions) Act, 2010, which had allowed the AL regime to bypass tendering and other standard procedures for power and energy projects to ensure quick supply.
While it led to increased power generation capacity, it was criticised for lacking transparency and judicial oversight, creating opportunities for corruption and leading to high costs like the payment of capacity charges for idle power plants.
Zahid Hussain, a member of the National Committee, explained that the electricity generation capacity had increased fourfold between 2020 and 2014, against a steep rise in payment for power by 11.1 folds.
The overall payment of $638 million for power in 2010 jumped to $7.8 billion in 2024, said Zahid, also a former lead economist of the World Bank Dhaka office.
The National Committee in its initial report has kept a special chapter focusing on anomalies in the approval process of the Adnai Power Limited in Jharkhand.
The power purchase agreement with the company was signed on November 5, 2017, for 25 years.
In March 2023, the power supply began from the plant of the Adani Group that has recently faced controversies both in India and internationally, primarily stemming from a recent United States鈥� bribery and fraud indictment.
The group鈥檚 rapid rise in India has often been linked to the political patronage of Indian prime minister Narendra Modi, with opposition parties, such as the Indian National Congress, accusing the government of misusing state-owned institutions and diplomatic influence to benefit the Adani Group.
