India's Adani Green Energy has announced its decision to pull out from two proposed wind power projects in Sri Lanka. The company conveyed this in a letter sent to a Sri Lankan government agency.
Last month, the Sri Lankan government initiated discussions with the Adani Group to reduce the cost of power from the projects, which were estimated to require a total investment of $1 billion. As per the letter addressed to the chairman of Sri Lanka's Board of Investment, it was revealed that a new negotiations committee and Project Committee would be formed to renegotiate the project proposal.
The company stated in the letter dated February 12, "This aspect was deliberated at the Board of our company and it was decided that while the company fully respects the sovereign rights of Sri Lanka and its choices, it would respectfully withdraw from the said project."
While Sri Lanka's Board of Investment declined to comment on the matter, the power ministry secretary was unavailable for immediate response. Adani Green Energy has not provided any official statement in response to the development.
Following allegations by U.S. authorities in November against Adani Group's founder Gautam Adani and other executives regarding a bribery scheme to secure Indian power supply contracts, Sri Lanka initiated a review of the company's local projects. Adani has refuted these accusations.
As part of the agreement with Sri Lanka, Adani Green Energy was slated to construct two wind power projects in Mannar town and Pooneryn village, both situated in the northern province of the country. Additionally, the Adani Group is also engaged in a $700 million terminal project at Colombo, Sri Lanka's primary port.
The island nation, facing financial strain and challenges such as power outages and fuel scarcities during the economic crisis in 2022, has been actively pursuing renewable energy initiatives to mitigate risks associated with fluctuations in imported fuel prices.
