In a boost to the embattled Adani Group, Sri Lanka’s Board of Investment on Wednesday approved the commissioning of two wind power plants by Adani Green Energy Limited for a total of $442 million. This will be crisis-hit island nation’s first major foreign investment since it declared bankruptcy last year.
The Board of Investment – the ‘apex agency for foreign direct investment in Sri Lanka’ – said the two would be commissioned in two years and added to the island nation’s power grid by 2025.
Adani Green Energy is the apple-to-airport group’s renewable energy unit.
According to Reuters, Adani officials are in Colombo to evaluate future projects, including a $700 million port terminal at Sri Lanka’s largest port – a project seen as a bid to address India’s concerns over China’s growing influence in the area.
The firm is building a 1.4 km long, 20 metre deep jetty next to a Chinese-run terminal at the only deep-sea container port between Dubai and Singapore.
The news comes as some good news for Gautam Adani’s conglomerate which this week saw the combined equity market value of its 10 companies slip below the $100 billion mark, even as the billionaire tycoon hires legal and communications firms to reassure investors after short-seller Hindenburg Research’s report alleging ‘brazen stock manipulation and accounting fraud’.
Adani himself has tumbled down the list of the world’s richest men – from No 2 on Bloomberg’s list to No 29 this morning. His net worth is below $50 billion.
READ | Hindenburg effect: Adani no longer among world’s 25 richest
Gautam Adani has denied any wrongdoing and the government has distanced itself from the group, particularly amid claims of overexposure by public financial bodies like the State Bank of India.
Finance minister Nirmala Sitharaman and Reserve Bank of India chief Shaktikanta Das this month both stressed strong regulatory measures that govern the Indian banking sector.
READ | Amid Adani-Hindenburg row RBI chief says banking system is…
Their reassurances, however, have been largely dismissed by a political opposition that has targeted prime minister Narendra Modi and his ruling Bharatiya Janata Party with allegations of ‘favouring’ the Adani Group.
READ | ‘mitr kaal’: Rahul Gandhi’s fresh attack on Modi govt over Adani
Sri Lanka’s power woes
Meanwhile, Sri Lanka has been struggling with a financial crisis of its own for several months now and last week hiked power prices by a staggering 66 per cent to nail down a $2.9 billion bailout package from the International Monetary Fund; power prices were hiked by 75 per cent last year.
Sri Lanka’s financial crisis has severely impacted life for its beleaguered citizens, who made headlines last year after they took to the streets to protest spiralling cost-of-living and had violent clashes state security personnel.
It will hope Adani’s plants can kickstart a recovery – at least for the power generation sector – amid hopes it will also generate 1,500 to 2,000 new jobs.
With input from agencies
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