Either renegotiate coal price or cancel Adani deal: Review panel
The committee, however, has stopped short of recommending immediate action, leaving the final decision to the next elected government.
Highlights:
- Committee urges renegotiation or cancellation of Adani power contract
- Review alleges corrupt linkages, suspicious foreign transactions tied to deal
- Next elected government to decide; no immediate action recommended
- Coal pricing formula inflates costs; Adani power financially burdensome
- Evidence may support domestic and international legal proceedings
- Adani power far costlier than other Indian electricity imports
The National Review Committee examining power contracts signed under the 2010 special act has recommended that Bangladesh either renegotiate the coal pricing formula with Adani Power Limited (APL) or move to cancel the agreement if the Indian company refuses to revisit the terms.
The committee, however, has stopped short of recommending immediate action, leaving the final decision to the next elected government. Its findings and recommendations are intended to serve as a framework for reviewing and addressing controversial power deals signed in previous years.
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Committee members told The Business Standard that the review uncovered what they described as "clear indicators of corrupt linkages" between senior officials of the former Awami League government and Adani Power.
"During the review process, we found evidence of unusual transactions to foreign bank accounts belonging to public servants, dating back to 2017 and coinciding with the negotiation and signing of the deal," one committee member said.
To assess the scope of the findings, TBS spoke with several committee members, senior officials at the Bangladesh Power Development Board (BPDB), and representatives from the power ministry.
A senior ministry official said most of the suspicious transactions were routed through foreign accounts, though a small number occurred domestically. "Those who benefited from the deal played a decisive role in fast-tracking the agreement just ahead of the controversial 2018 national election," the official claimed.
When asked whether the committee had identified direct evidence of money transfers from the Adani Group or its affiliates to Bangladeshi officials, the official declined to comment.
According to the review report, Adani Power remains important for meeting Bangladesh's summer electricity demand, but fundamental weaknesses in the contract have made it financially burdensome.
"The coal pricing formula, based on an average of Indonesian and Australian coal indices, artificially inflates fuel costs compared with other Indian suppliers," a policy-level ministry official said.
Another senior official said that while some evidence is circumstantial, the intent and structure of the deal suggest that officials involved accumulated "substantial sums" in foreign accounts during the contract process.
"Our report clearly identifies the evidence, the individuals involved, those who expedited the agreement, and those who benefited from it," a committee member said.
Speaking on condition of anonymity, the member alleged "direct interference" by the ousted former prime minister Sheikh Hasina, who simultaneously held the power, energy and mineral resources portfolio, and accused two former power secretaries—Abul Kalam Azad and Ahmad Kaikaus—of involvement in what was described as "organised corruption".
Committee chair Justice (retd) Moinul Islam Chowdhury was asked whether the findings were strong enough to support legal proceedings should Bangladesh seek to terminate the agreement.
"The media will get all the answers tomorrow (25 January) at a press conference," he said.
Formation of committee
The five-member committee was formed on 5 September under the Power Division to review contracts signed under the "Speedy Increase of Power and Energy Supply (Special Provisions) Act, 2010" during the Awami League regime.
Retired High Court Division Justice Moinul Islam Chowdhury chaired the committee, joined by Buet Professor Abdul Hasib Chowdhury, former KPMG COO Ali Ashfaq, former lead economist at World Bank's Dhaka office Zahid Hussain, and University of London economist Moshtaq Hossain Khan. Supreme Court lawyer Shahdeen Malik later joined, bringing total membership to six.
'Organised corruption' in the power sector
In a preliminary assessment, the committee concluded that organised corruption had become entrenched in the power sector, contributing to a 25% increase in electricity tariffs.
Moshtaq Hossain Khan said evidence linked to the Adani deal could support legal action both within Bangladesh and internationally. Justice Chowdhury noted that while the extent to which the contract could ultimately be annulled remains uncertain, "extensive corruption was found in it".
Sources told TBS that several former Power Division secretaries, BPDB chairmen, and officials from Power Grid Bangladesh PLC and the Power Cell acted under direct instructions from then prime minister Sheikh Hasina.
ACC seeks Adani deal documents
Following a High Court writ petition, the Anti-Corruption Commission (ACC) has collected documents and information from BPDB regarding the Adani deal.
A BPDB official said on condition of anonymity, "The decision to finalise the Adani Power deal was made by Hasina. Officials involved executed her orders, and some may have benefited from the Adani Group."
Standoff over coal pricing formula
After the Awami League's removal from power in August 2024, BPDB held several rounds of talks with Adani Power to renegotiate the coal pricing formula. The most recent meeting, held virtually on 23 June, involved Adani CEO Shersingh B Khyalia and BPDB company affairs secretary ANM Obaidullah.
Officials said Adani refused to reopen the agreement and instead nominated a mediator, asking BPDB to do the same before taking the dispute to the Singapore International Arbitration Centre.
At the time, BPDB Chairman Md Rezaul Karim said, "Adani's decision to appoint a mediator indicates that it prefers a legal battle rather than resolving the issue through negotiation." Power Adviser Fouzul Kabir Khan said the government was prepared to pursue legal action to safeguard national interests.
Adani deal at a glance
The Adani deal was initiated during Indian Prime Minister Narendra Modi's 2015 Dhaka visit, when a Memorandum of Understanding was signed with BPDB. A 25-year Power Purchase Agreement for 1,496MW was signed in November 2017.
The first 800MW unit began operations in April 2023. Despite media scrutiny over higher coal prices, APL assured Bangladesh its power would not exceed costs from Rampal or other coal-fired plants.
BPDB data, however, shows Adani-supplied power is over 85% more expensive than other Indian imports, costing Tk14.87 per kWh in FY24 compared to Tk8-10 per kWh from other suppliers.
