Bangladesh is seeking a full restoration of power supply from the Adani Group, three months after it was reduced to nearly half due to large pending dues.
The state-run Bangladesh Power Development Board (BPDB) told Reuters that it has expedited the clearing of outstanding dues to Adani Power, the energy-producing arm of the Adani Group, and has requested the company to resume supply from the second unit.
The news agency also reported, citing sources, that BPDB and Adani Power officials were set to hold a virtual meeting on Tuesday to resolve various issues.
Why Adani Cut Power Supply?
In November 2017, Adani Power signed a 25-year Power Purchase Agreement (PPA) with BPDB under the government of then-Prime Minister Sheikh Hasina. Under the deal, the Indian ports-to-power conglomerate built a coal-fired power plant in the Indian state of Jharkhand with a net capacity of 1,496 MW, supplying electricity exclusively to Bangladesh via a dedicated 400 kV DC transmission line.
Electricity supply began in June 2023.
However, questions were soon raised about the deal and the price at which the Adani Group was selling power to Bangladesh.
After Prime Minister Hasina was ousted and a new interim government took power last year, it reportedly began reviewing the agreement. The government later accused the Adani Group of violating the terms of the deal by failing to inform authorities about tax structure changes at the power plant in Jharkhand's Godda district. A Bangladesh court has separately ordered a probe into the Adani deal.
Meanwhile, Bangladesh’s overdue payments for power supplied by Adani Power accumulated, reaching as high as $843 million in November 2023. Reports suggest that, citing these outstanding dues, Adani Power began reducing electricity supply to Dhaka.
During Adani Power’s third-quarter earnings call, CEO Shersingh Khyalia confirmed that around $800 million remained unpaid by Bangladesh.
"Overdue payments stand at approximately $700 million. Additionally, there is a $100 million difference due to reconciliation issues, as they have not accounted for the late payment surcharge (LPS), etc. So, broadly, you can take $700 million as outstanding as of now," he said.
BPDB Chairperson Md. Rezaul Karim told Reuters that they are currently paying $85 million per month to Adani Power and will try to pay even more to reduce the overdue amount.
