Bangladesh likely to maintain power deal with India's Adani

Bangladesh is likely to maintain its power purchase deal with India’s Adani Power despite concerns over pricing, due to supply issues and weak prospects for a legal challenge, according to two sources.

A panel set up by the new government is reviewing contracts signed by its predecessor, including a 2017 agreement to buy electricity for 25 years from Adani’s $2 billion power plant in Jharkhand. The plant supplies nearly 10% of Bangladesh’s electricity, making it difficult to cancel the deal.

One source indicated that while exiting the contract seems unlikely, renegotiating the tariff might be possible. Currently, Bangladesh pays about 12 taka ($0.1008) per unit of electricity, 27% higher than from other private Indian producers and up to 63% more than state-owned plants.

Adani Power has not received any official notice of a review but has expressed concern over Bangladesh’s $800 million in unpaid dues. Despite the mounting debt, Adani continues to supply power. Domestic critics, including the opposition Bangladesh Nationalist Party, have pushed for a review, citing overpricing concerns. The interim government, led by Nobel laureate Muhammad Yunus, is also reviewing other contracts, with possible cancellations in the pipeline.