Bangladesh fast tracks payment to Adani Power ahead of November 7 deadline

The Gautam Adani-owned company reduced the power supply to Bangladesh to 700-800 MW this month, nearly half than earlier, after failing to secure its dues of $846 million

Ahead of Adani Power’s November 7 deadline, Bangladesh is accelerating payment of more than $800 million it owes to the company, days after the group halved its electricity exports to the nation.

 

Adani Group’s Godda plant in Jharkhand, which exported 1,600 megawatt (MW) power to Dhaka, had set the deadline after Dhaka struggled with payments amid the ongoing political crisis.

 

The group set the deadline after facing challenges in importing coal necessary for power generation at the plant. The Gautam Adani-owned company reduced the power supply to 700-800 MW this month after failing to secure its dues of $846 million. The data from Power Grid Bangladesh PLC showed that the power had been reduced on Thursday night, according to Dhaka-based Daily Star newspaper.

 

Why is Bangladesh struggling to clear bills

Costly fuel and goods imports, driven by the Russia-Ukraine crisis, added to Dhaka’s woes over clearing payments. After former Prime Minister Sheikh Hasina was ousted from power on August 5 following a three-week long political turmoil, Bangladesh's struggles further mounted.

 

According to Muhammad Fouzul Kabir Khan, the power and energy adviser in the interim Bangladesh government, the country was able to clear $96 million dues to Adani Power last month. It was also reported earlier that Bangladesh was scrutinising its contract with Adani Power. The main reason cited was that the group was apparently charging Bangladesh about a 27 per cent higher rate compared to other Indian private players.

 

Last week, Adani Power’s Chief Financial Officer Dilip Kumar Jha said that the group was not facing any issues with the power supply to Dhaka. "We hope that there will be no further deterioration in terms of the outstanding," he said.

 

Earlier, the company had written to Dhaka over unpaid dues, noting that power supply would be suspended by October 31 - the same day that Adani Power halved the power supply.

 

(With inputs from Reuters)