Has Bangladesh Settled All Dues to Adani Power and Resolved Its Power Purchase Agreement?
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Synopsis
Bangladesh has cleared all outstanding payments to Adani Power, totaling $437 million, marking a pivotal moment in the country's energy landscape. This settlement not only resolves past disputes but also reinforces the partnership's potential for future power supply stability. Explore the implications of this agreement for Bangladesh’s energy future and Adani Power’s prospects.
Key Takeaways
- Bangladesh settled $437 million in dues to Adani Power.
- Adani Power's plant supplies 10% of Bangladesh's electricity.
- Payment includes carrying costs and PPA issues.
- Sovereign guarantees were established for added security.
- Improved credit rating expected for Adani Power.
New Delhi, July 1 (NationPress) In a significant move, Bangladesh has confirmed its commitment to the Adani Power Ltd assets as a dependable and economically viable energy solution for addressing the nation’s escalating power demands. Last month, Bangladesh executed its largest payment of $437 million, successfully settling all outstanding obligations to the company.
The nation has now reached out to Adani Power, a subsidiary of the diverse Adani Group, requesting the provision of electricity from both operational units in line with the BPDB (Bangladesh Power Development Board) timetable, as the debts have now been cleared, sources reported on Tuesday.
This payment encompasses carrying costs along with matters pertaining to the power purchase agreement (PPA).
Additionally, a Letter of Credit (LC) equivalent to approximately two months of billing, along with a sovereign guarantee for all outstanding debts, has been established, according to informed sources. The LCs represent about two months' billing cycle and provide an additional layer of security.
Adani Power supplies electricity to Bangladesh via a dedicated 1,600 MW plant situated in the Godda district of Jharkhand, fulfilling 10 percent of the nation’s power requirements.
As per the 2017 agreement, Adani Power's Godda power facility was set to deliver 100 percent of the electricity produced from coal combustion to Bangladesh for a duration of 25 years.
Previously, Bangladesh faced challenges in fulfilling its payment commitments under this agreement due to escalating import expenses and internal political dynamics. Consequently, Adani reduced its supply by half last year, but full deliveries were reinstated in March 2025 as the country’s monthly payments began to address some of the outstanding amounts.
In recent months, Bangladesh has been disbursing between $90-100 million monthly. The recent $437 million payment comes in the wake of the country experiencing heightened power shortages in rural regions.
These recent developments have instilled confidence among lenders regarding Adani Power Ltd’s credit rating, which is poised to rise to AA+ from the current AA, potentially lowering its funding costs.
According to sources, these latest advancements reaffirm the agreement made between the Bangladesh government and Adani Power.
Point of View
I believe that this development marks a significant step forward for both the Bangladesh government and Adani Power. Clearing these dues enhances trust and stability in the energy sector, essential for meeting the growing demands of our nation. As Bangladesh continues to navigate its energy needs, this partnership could serve as a model for future agreements.
NationPress
31/08/2025
Frequently Asked Questions
What is the total amount Bangladesh paid to Adani Power?
Bangladesh made a payment of $437 million to Adani Power, clearing all pending dues.
Why did Bangladesh struggle with payments in the past?
Bangladesh faced challenges in meeting payment obligations due to rising import costs and domestic political issues.
What is the capacity of the Adani Power plant supplying Bangladesh?
The Adani Power plant located in Godda district has a capacity of 1,600 MW.
How much power does Adani supply to Bangladesh?
Adani Power supplies 10 percent of Bangladesh's total power demand.
What is the significance of the sovereign guarantee?
The sovereign guarantee provides additional security for all dues, ensuring financial stability in the agreement.
