Bangladesh cries foul, wants to renegotiate a 2017 power deal with Adani

Bangladesh’s caretaker government is reportedly hoping to renegotiate a multi-billion-dollar deal with Adani to supply power from its coal-fired plant in eastern India in 2017. The deal was signed by then-Prime Minister Sheikh Hasina without a competitive bidding process, much more on Bangladesh. cost more than its other coal-fired power plants.The interim government blamed Adan Power for the deal in violation to retain the tax benefits that the central power plant received from New Delhi for the transaction.

According to a Reuters report, Dhaka owes several million dollars for the energy already supplied. However, both sides dispute the exact size of the bill. Bangladesh’s Energy Minister Muhammad Fuzul Kabir Khan said the country now has enough domestic capacity to cope without Adani supplies.

According to the report, Bangladesh plans to reopen the 25-year-old deal and hopes to use the fallout from the US indictment in the $265 million bribery scheme to seek a settlement.The Adani Group has denied the allegations, calling them baseless.

A spokesman for Adan Power said that all contractual obligations had been met by them and that they had no indication of Bangladesh revising the contract.

Delhi had declared Adani Power’s Godda plant, which consumes imported coal and was built to serve Bangladesh, as part of a special economic zone, under which it enjoyed incentives such as exemptions from income tax and other levies.

The power utility was required to notify Bangladesh of changes in the plant’s tax status and transfer the benefit of a tax exemption from the Indian government, according to an agreement between Adan Power and the State Power Development Board of Bangladesh (BPDB). In 2017, however, the company failed to do so, according to BPDB’s letters calling for the benefits to be returned.

BPDB officials told the news agency that they never heard back from the company.Bangladesh expects potential savings of about $28.6 million.

Meanwhile, Adani Power halved electricity supply from its Godda plant on October 31, citing a payment dispute with Bangladesh based on the calculation of electricity tariffs.According to Reuers, Adani Power declined BPDB’s request to extend the discount , which was offered until May.This discount resulted in approximately $13 million in savings for Bangladesh Power has said it will not consider further discounts until the payment issue is resolved.

Adani Power claims it is owed $900 million, while BPDB is owed about $650 million.

The power cut has particularly disappointed Bangladesh, with BPDB chairman Dr Rezaul Karim expressing anger as the move follows Dhaka’s transfer of $97 million to Adani Power in October, the highest monthly payment this year.