The Adani Group, an Indian conglomerate, has withdrawn from a $442 million wind power project in Sri Lanka after the island nation’s government sought to renegotiate the terms of the agreement, Al Jazeera reports.
The decision follows scrutiny of Adani Group projects in Sri Lanka and allegations of bribery.
Sri Lanka’s Board of Investment (BOI) announced on Thursday that it had received a letter from Adani Green Energy Limited expressing their decision to “respectfully withdraw” from the project, which included the construction of two wind power plants and two transmission projects.
The Sri Lankan government had been reviewing the Adani projects following accusations by US authorities in November that Gautam Adani, the billionaire founder of the Adani Group, and other executives were involved in a bribery scheme to secure power supply deals in India. The Adani Group has denied these charges.
Last month, the government announced it had initiated discussions with the Adani Group to lower the cost of power generated by the projects, aiming to reduce the tariff from $0.08 per kilowatt-hour (kWh) to $0.06 or less. The project agreement was initially signed in May 2024 under the interim presidency of Ranil Wickremesinghe.
An Adani spokesperson stated that the group’s withdrawal was due to the projects being “financially unviable” under the renegotiated terms. In a statement, Adani Green expressed its continued commitment to Sri Lanka and openness to future collaborations should the government in Colombo desire.
The Adani Group also maintains involvement in a $700 million terminal project at the Port of Colombo, Sri Lanka’s largest port. However, the US International Development Finance Corporation previously withdrew a pledged $553 million investment in Adani’s West Container Terminal in Colombo.
Sri Lanka, which experienced severe power outages and fuel shortages during an economic crisis in 2022, has been actively pursuing renewable energy projects to reduce its reliance on imported fuel costs. The Adani Group was the first foreign investor to enter Sri Lanka following that financial crisis.
