The new government in Bangladesh will not cancel the power purchase agreement with Adani Power. Minister of Power, Energy, and Mineral Resources Iqbal Hasan Mahmud said that the BNP-led government will retain the power purchase agreement with Adani Power.
In conversation with a Dhaka-based digital news and infotainment platform Deshkal News, Mahmud said that the government has no plan to cancel the deal.
Bangladesh signed the agreement in 2017, to purchase electricity from Adani Power during the tenure of former Prime Minister Sheikh Hasina. The deal drew strong criticism at the time.
Opposition leaders and several energy analysts — including leaders from Bangladesh Nationalist Party (BNP) — questioned
its transparency and described it as financially disadvantageous for the country. Some BNP leaders and economists even labelled it a one-sided agreement that failed to adequately safeguard Bangladesh’s national interests.
Pragmatism Over Protest
However, after assuming office, the BNP government has taken a comparatively restrained stance.
Speaking to Deshkal News, the minister said, “We have no plan to cancel the Adani agreement. However, some private power contracts may be reviewed to ensure that their terms are balanced and sustainable in the long term.”
The minister’s remarks suggest that instead of cancelling the agreement the government will renegotiate or adjust certain terms if necessary while keeping the overall framework of the Adani deal intact, said sources.
Adani and Bangladesh had a conflict regarding pending dues by the latter which rose from $800 million to $850 million last year. Bangladesh paid $437 million to Adani in June last year bringing down its dues to nearly $400 million to $450 million.
1,400 MW Necessity
Currently, Adani Power supplies around 1,400 megawatts (MW) of electricity to Bangladesh on a daily basis. With the country’s average electricity demand standing at nearly 14,000 MW, this accounts for nearly 10% of total consumption.
Bangladesh’s dependence on imported electricity has increased in recent years. According to data from the Power Grid Company of Bangladesh (PGCB), the country imports between 2,300 and 2,656 MW of electricity per day, representing about 15 to 17% of total supply.
A significant portion of these imports comes from Adani’s 1,600-MW coal-fired power plant located in Jharkhand, which operates under a long-term agreement.
In addition, Bangladesh engages in government-to-government (G2G) electricity trade arrangements with Indian entities, bringing total import capacity to over 2,800 MW.