Bangladesh has urged Adani Power to fully resume electricity supply from its 1,600-megawatt plant in India after more than three months of reduced output, a Bangladesh official confirmed. The supply reduction, which began on October 31, 2024, was linked to lower winter demand and payment delays.
Adani Power, which signed a 25-year agreement with Bangladesh under former Prime Minister Sheikh Hasina in 2017, has been supplying electricity exclusively to Bangladesh from its $2 billion plant in Jharkhand, India. The facility consists of two 800-megawatt units.
However, due to payment issues arising from Bangladesh’s foreign exchange crisis, Adani halved its supply on October 31, leading to the shutdown of one unit the following day. Since then, the plant has been operating at about 42 percent capacity.
Bangladesh later requested Adani to continue supplying only half of the contracted power. Now, with improved payment conditions, the Bangladesh Power Development Board (BPDB) has asked Adani to restore full supply.
Technical Hurdles in Restoring Full Supply
BPDB Chairperson Md. Rezaul Karim stated that Adani had planned to restart the second unit as per Bangladesh’s request. However, technical issues prevented synchronization on Monday.
“As per our requirement today, they planned to synchronize the second unit, but due to high vibration, it didn’t happen,” Karim told Reuters.
He also emphasized that Bangladesh has been making monthly payments of $85 million to settle outstanding dues with Adani and aims to increase payments to reduce overdue amounts. “Right now, we are making a payment of $85 million per month. We are trying to pay more, and our intention is to reduce the overdue. Now there is no big issue with Adani,” he added.
An Adani Power spokesperson did not immediately respond to requests for comment. In December, an Adani source claimed that BPDB owed the company around $900 million, while Karim stated at the time that the outstanding amount was closer to $650 million.
Pricing Dispute and Contract Review
The pricing dispute centers around how tariffs are calculated. The 2017 agreement bases power rates on an average of two pricing indexes. According to previous reports by Reuters, Adani’s electricity costs Bangladesh approximately 55 percent more than the average price of Indian power supplied to Dhaka.
A Bangladesh court has ordered a review of the contract by a panel of experts, with findings expected this month. The results could lead to potential renegotiations of the agreement.
Last year, Bangladesh’s interim government accused Adani of violating the power purchase agreement by withholding tax benefits that the Jharkhand plant received from New Delhi. Documents obtained by Reuters in December revealed that Bangladesh officials were actively reviewing the contract.
At the time, an Adani spokesperson maintained that the company had honored all contractual obligations and had received no official indication from Bangladesh regarding a contract review.
Legal Issues and Political Developments
Karim has not commented on whether the disputes between BPDB and Adani have been fully resolved.
Meanwhile, in November, US prosecutors indicted Adani Group founder Gautam Adani and seven executives for their alleged involvement in a $265 million bribery scheme in India. The Adani Group has dismissed these allegations as “baseless.”
In a related development, the Bangladesh government formed a committee in September to scrutinize major energy deals signed by Sheikh Hasina. Hasina fled to New Delhi in August following widespread student-led protests.
