Colombo mulls converting Adani power project to a G2G deal: Sri Lankan media 

Sri Lanka's Energy Minister seeks to convert agreement with Adani Green Energy to govt-to-govt deal. Reports suggest shift due to legal requirement. Opposition accused Group of making "backdoor entry" & India of "pressuring" island. President held talks with Adani, energy project to be completed by 2025. Adani Group also building port terminal with $700m investment.

In a cabinet memorandum last month, Sri Lanka’s Energy Minister has sought to convert the agreement with Adani Green Energy Limited — for execution of renewable energy projects in the island’s Northern Province — to a government-to-governmental deal, according to Sri Lankan media reports.

Leading Colombo-based weekend newspaper The Sunday Times reported on September 3, 2023: “A US$ 400 million project with India’s Adani Green Energy Limited for a 500-megawatt power project in Mannar has been elevated to be on a Government-to-Government basis,” based on a recent cabinet memorandum put forward by Power and Energy Minister Kanchana Wijesekera.

The shift, local media reports suggested, was on account of a legal requirement. The Hindu was unable to reach the Minister, and is yet to hear back on its message requesting him for comment.  

Meanwhile, online portal Newsfirst on August 31, 2023, reported that sections had raised concern over “the decision to award India’s Adani Group with an on-grid renewable energy development project in Mannar and Pooneryn, by considering it as a government-to-government arrangement”. The news portal referred to the cabinet paper dated August 14, 2023.  

The media reports coincide with renewed international media scrutiny of the Adani Group, following an investigation conducted by the Organized Crime and Corruption Reporting Project (OCCRP), a global network of journalists. Last week, publications including The Guardian and Financial Times reported that the Adani family had secretly invested in own shares, sparking a fresh controversy months after U.S.-based research firm Hindenburg accused the Group’s chief Gautam Adani of pulling off the “largest con in corporate history”.

Sri Lanka’s Board of Investment cleared the Group’s involvement in the $442 million renewable energy project in February 2023, even as the company’s stocks crashed in the wake of the Hindenburg report published the previous month. In an interview with The Hindu in March 2023, Foreign Minister Ali Sabry said Colombo was confident about the future of the Adani projects on the island, as it was a “a government-to-government kind of a project”.  

However, no final decision has been made in regard to converting the energy project agreement with Adani Green into an official bilateral deal yet, Newsfirst said, quoting State Minister of Power and Energy, Indika Anuruddha Herath. The proposal would be directed to the Public Utilities Commission of Sri Lanka, before the Attorney General’s directives are obtained, he was quoted as saying.