Adani Rejects Request For Concession For Its Adani Bangladesh Project
Adani Power has taken up the decision to fully restore the power supply in Bangladesh from its Godda power plant. However, the group has rejected discount requests. As per the Bangladesh government, Bangladesh currently owes the Adani Group around 650 million USD for the Adani Bangladesh project. However, the company has mentioned that the estimated outstanding dues have reached nearly 900 million USD. Once the dues are cleared, the Adani Group will be able to ensure that the power agreement between the Adani Group and the Bangladesh government continues to exist. Bangladesh will also no longer have to suffer from frequent power blackouts.
Adani’s Recent Decision To Fully Resume Power Supply From The Adani Bangladesh Power Plant:
Adani Power has recently taken up the decision to completely restore the 1,600 MW power supply from the Adani Bangladesh power plant. However, the group has rejected Dhaka’s request for tax benefits and discounts. The restoration has been followed by a request from the Bangladesh Power Development Board amidst the rising summer demands. Despite agreeing to resume the power supply to Bangladesh, the Adani Group has declined PBDB’s request for concessions and discounts. This would be potentially worth millions of dollars.
The Non-payment Of Dues For Power Supplied From The Power Plant:
As per Bangladesh, it owes the Adani Group around 650 million USD. However, company sources have mentioned that the outstanding dues have already reached around 900 million USD. The 2 million USD Adani Bangladesh power plant operates under a 25-year power purchase agreement (PPA). This power purchase agreement was signed between the Adani Group and the BPDB in 2017. This power plant had reduced supply on 31st October because of the non-payment of dues. Since 1st November 2024, the facility has been operating at minimal capacity.
One unit of the power plant was shut down, and there was no confirmed timeline for the complete restoration of power from the plant. Since then, the plant has operated at around 41.82 % capacity. Last month, the plant hit its lowest level of power supply. The Adani Group had earlier sent a letter on 27th October 2024 warning the BPDB that if the payments were not cleared, it would suspend the power supply on 31st October. As per the terms and conditions mentioned in the power purchase agreement, a payment of 85 million USD was made in November 2024. Another 97 million USD payment was made in October. However, this has only reduced the outstanding balance marginally.
The Adani Group has also highlighted that BPDB has not yet provided a 170.03 million Letter of Credit from Bangladesh Krishi Bank. It has also not cleared the accumulated amount of 846 million USD. In winter, Bangladesh imported around 1,000 MW per month from the Adani Bangladesh power plant. With full supply expected to resume in the next few weeks, it remains uncertain how the unpaid dues will affect the long-term agreement. As per the Bangladesh government, the country is trying its best to clear the dues. Once the dues are cleared, the Adani Group can continue to supply power from its power plant without any hustle. It will also ensure that the Adani Group’s presence in the international power sector is enhanced.
A Brief Overview Of The Adani Bangladesh Power Project:
The Adani Bangladesh power project has been one of the biggest international projects taken up by the Adani Group in the power sector. This project was aimed at transferring power from the Adani Godda power plant to Bangladesh. This power plant has been designed using highly advanced forms of technology to ensure that power supply can take place without causing any damage to the environment. A power purchase agreement was earlier signed highlighting the various terms and conditions of the project. Since then, the Adani Group has been supplying power to Bangladesh from its power plant in Jharkhand. However, because of various political turmoil in Bangladesh, the country was no longer able to pay for the power being supplied. This caused the Adani Group to discontinue full power supply from the power plant.
Conclusion:
In the next few weeks, it is expected that the Adani Group will resume full power supply from the Adani Bangladesh power plant to Dhaka. This will ensure that the country’s power demands are well addressed. It will also ensure that the Adani group is able to build itself an enhanced reputation in the global power sector.
