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Bangladesh Court Halts Adani Arbitration Pending Probe
ECONOMY & POLICY

Bangladesh Court Halts Adani Arbitration Pending Probe

Bangladesh’s High Court on Thursday ordered India’s Adani Group to halt its planned international arbitration in Singapore over a payment dispute with the state-run Bangladesh Power Development Board (BPDB). The suspension will remain in place until an investigation into Adani’s power supply agreement is completed.

Court officials said a two-judge bench directed that arbitration be paused until a committee appointed by the court submits its findings on the power purchase agreement and any potential irregularities. The order followed a petition seeking judicial intervention to review and scrap the BPDB–Adani deal, which the petitioner described as “one-sided” and signed during the tenure of former prime minister Sheikh Hasina.

The petition argued that Adani’s tariff was significantly higher than regional benchmarks — with electricity from Indian state-owned firms priced at 5.5 taka per unit, from other private Indian firms at 8.5 taka, and from Nepal at 8 taka, compared with more than 14 taka per unit for Adani’s supply.

The injunction comes even as BPDB and Adani continue negotiations over payment disputes. Bangladesh’s interim administration led by Professor Muhammad Yunus has previously accused Adani of breaching the power purchase agreement by withholding tax benefits received for the Godda plant in India. Bangladesh paid Adani 14.87 taka (USD 0.122) per unit in the fiscal year ending 30 June 2024 — well above the 9.57 taka average paid to other Indian suppliers.

Earlier this month, Adani Power said it had opted for international arbitration to resolve disagreements over unpaid dues under the 2017 contract. “There are disagreements in the way certain cost elements are calculated and billed… both partners have agreed to invoke the dispute resolution process,” an Adani spokesperson said.

Bangladesh’s energy adviser, Muhammad Fouzul Kabir Khan, confirmed that negotiations were ongoing and suggested arbitration could still be an option, but the High Court order has temporarily blocked that route. Petitioner Abdul Kaiyum argued that allowing arbitration to proceed before the investigative report is released would undermine the inquiry’s significance.

Adani Power supplies electricity from its 1,600-megawatt coal-fired Godda plant in eastern India, which meets nearly one-tenth of Bangladesh’s total power demand.

Bangladesh’s High Court on Thursday ordered India’s Adani Group to halt its planned international arbitration in Singapore over a payment dispute with the state-run Bangladesh Power Development Board (BPDB). The suspension will remain in place until an investigation into Adani’s power supply agreement is completed. Court officials said a two-judge bench directed that arbitration be paused until a committee appointed by the court submits its findings on the power purchase agreement and any potential irregularities. The order followed a petition seeking judicial intervention to review and scrap the BPDB–Adani deal, which the petitioner described as “one-sided” and signed during the tenure of former prime minister Sheikh Hasina. The petition argued that Adani’s tariff was significantly higher than regional benchmarks — with electricity from Indian state-owned firms priced at 5.5 taka per unit, from other private Indian firms at 8.5 taka, and from Nepal at 8 taka, compared with more than 14 taka per unit for Adani’s supply. The injunction comes even as BPDB and Adani continue negotiations over payment disputes. Bangladesh’s interim administration led by Professor Muhammad Yunus has previously accused Adani of breaching the power purchase agreement by withholding tax benefits received for the Godda plant in India. Bangladesh paid Adani 14.87 taka (USD 0.122) per unit in the fiscal year ending 30 June 2024 — well above the 9.57 taka average paid to other Indian suppliers. Earlier this month, Adani Power said it had opted for international arbitration to resolve disagreements over unpaid dues under the 2017 contract. “There are disagreements in the way certain cost elements are calculated and billed… both partners have agreed to invoke the dispute resolution process,” an Adani spokesperson said. Bangladesh’s energy adviser, Muhammad Fouzul Kabir Khan, confirmed that negotiations were ongoing and suggested arbitration could still be an option, but the High Court order has temporarily blocked that route. Petitioner Abdul Kaiyum argued that allowing arbitration to proceed before the investigative report is released would undermine the inquiry’s significance. Adani Power supplies electricity from its 1,600-megawatt coal-fired Godda plant in eastern India, which meets nearly one-tenth of Bangladesh’s total power demand.

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