Bangladesh Panel Says Adani Power Deal Overpriced, Flags Procedural Flaws
Dhaka – A government-appointed review committee in Bangladesh has found that a major power purchase agreement with Adani Power is overpriced and riddled with procedural irregularities. The findings have intensified scrutiny of one of the country’s most significant cross-border electricity deals.
The panel concluded that electricity imported from Adani’s coal-fired Godda plant in India is being supplied at rates substantially higher than prevailing market prices. According to the committee, the pricing structure places an excessive financial burden on Bangladesh’s power sector.
The report stated that power from the Godda plant was priced at nearly 40% above its closest private-sector competitor. It also recorded the steepest cost escalation among all electricity import arrangements Bangladesh currently maintains with India.
Investigators attributed the price divergence to specific contractual choices made during the agreement process. They added that serious anomalies were identified in the procedures through which the contract was awarded.
One of the most contentious findings relates to the treatment of corporate taxes. The committee said Adani billed Indian corporate taxes directly to Bangladesh, a practice it described as inconsistent with standard international norms.
Typically, independent power producers are expected to bear corporate taxes in their home jurisdictions. The report noted that the Adani agreement deviated from this practice by embedding Indian tax components into the tariff charged to Bangladesh.
The panel also highlighted concerns over fuel costs, stating that coal used by the Godda plant was excessively priced. It described the deal as the most significant statistical outlier within Bangladesh’s portfolio of cross-border electricity procurement.
According to the committee’s estimates, the price being paid for electricity under the contract is roughly 50% higher than what would be considered reasonable. This has raised broader concerns about fiscal sustainability and long-term energy planning.
The report has not yet been officially made public, but its findings are already prompting calls for action. The committee recommended a comprehensive review of electricity contracts to identify scope for renegotiation of the most fiscally damaging provisions.
Adani Power responded by saying it had not been consulted during the review process and had not been provided a copy of the report. The company said it was therefore unable to comment on the panel’s conclusions.
The company added that it continues to supply electricity to Bangladesh despite being owed substantial payment dues. It noted that other power producers have reduced or halted supplies due to delayed payments, affecting sector stability.
Adani Power urged the Bangladesh government to clear outstanding dues at the earliest. It warned that continued payment delays could impact its operations and the reliability of cross-border power supply.
The Godda plant supplies more than 10% of Bangladesh’s electricity imports, making it a critical component of the country’s energy mix. Any renegotiation or disruption could therefore have significant implications for power availability.
Energy analysts say the findings may prompt Bangladesh to reassess how it structures future power import agreements. Greater transparency and competitive bidding are likely to be emphasized to avoid similar issues.
The report comes at a time when Bangladesh is grappling with rising energy costs and fiscal pressures. Managing long-term power contracts has become increasingly important as demand continues to grow.
While no immediate decision has been announced, the panel’s findings are expected to influence policy discussions in the coming months. The outcome could reshape Bangladesh’s approach to cross-border electricity procurement.
