Winning Bizness Desk
Mumbai.The Sri Lankan government has canceled its Power Purchase Agreement (PPA) with the Adani Group amid allegations of corruption and fraud against Gautam Adani in the United States. The agreement, signed in May 2024, involved purchasing electricity from Adani's 484 MW Wind Power Complex, which was planned to be built in the Mannar and Pooneryn coastal areas of Sri Lanka.
As per the agreement, the Sri Lankan government was to buy power at the rate of $0.0826 per kilowatt-hour (approximately ₹7.12 at the current exchange rate). According to sources cited by AFP, while the PPA has been canceled, the wind power project itself has not been terminated.
Sri Lankan Administration Orders Review of the Project
President Anura Kumara Dissanayake's administration has initiated a review of the Adani Group’s local project by forming a special committee. This move follows opposition from several Sri Lankan activists who argued that smaller renewable energy projects in the country were offering power at nearly two-thirds of the cost proposed by Adani. Furthermore, the project has faced a legal challenge in Sri Lanka’s Supreme Court over environmental concerns.
Corruption Allegations in the US
The Adani Group’s chairman, Gautam Adani, is facing allegations of bribery and fraud in the United States. Reports suggest that the U.S. Securities and Exchange Commission (SEC) cannot issue a direct summons to him but must follow appropriate diplomatic channels.
Meanwhile, the case involving Adani and eight others has reached the Supreme Court of India. Advocate Vishal Tiwari has filed a petition seeking an investigation into the allegations made by U.S.-based short-seller Hindenburg Research. The petition also highlights flaws in the Securities and Exchange Board of India’s (SEBI) probe into the matter and raises concerns about the regulator’s credibility.
Bangladesh Halved Power Demand from Adani in November
In November 2024, Bangladesh halved its power demand from Adani Power, citing reduced requirements during winter and delays in clearing outstanding payments. Earlier, on October 31, 2024, Adani Power had reduced electricity supply to Bangladesh due to payment delays. At the time, the chairman of Bangladesh Power Distribution said the delay in dues caused a disruption in the power supply arrangement.
Ongoing Challenges for Adani Group
The Adani Group continues to face scrutiny and challenges internationally. The cancellation of the Sri Lankan PPA, coupled with controversies in India, Bangladesh, and the United States, adds to the growing pressure on the conglomerate. Sri Lanka’s decision highlights increasing concerns over cost-effectiveness, transparency, and environmental impact in energy projects.
Adani Group Rubbishes All Reports
Adani Group on Friday, however, have rejected all reports claiming that 484 MW wind power projects awarded to Adani Group companies in Mannar and Poonri in Sri Lanka have been cancelled. Terming such reports as 'false and misleading', a company spokesperson said the group is committed to investing about $1 billion in Sri Lanka's green energy sector. The group spokesperson said in his statement, "Reports of cancellation of Adani Group's 484 MW wind power projects in Mannar and Poonri are false and misleading. We clearly state that the PPA (power purchase agreement) has not been cancelled."
