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Adani-Reliance power project gets political patronage

Adani and Reliance, the private sector giant companies of India, are receiving political patronage from the Indian government to set up power plants outside of the country. Providing the two companies with unsolicited opportunity to implement the projects is an infringement of the existing laws in Bangladesh, according to experts.

The social media is rife with reports regarding this political patronage, particularly in the case of Adani. The well-known CNN-IBN correspondent Karan Thapar’s remarked on Twitter is particularly significant.

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Karan Thapar tweeted that Adani Power Limited gets to sign an agreement or MOU for power projects in every country that prime minister Narendra Modi has visited and committed credit. Thapar released this tweet on 6 June. The very same day Adani and Reliance signed two MOUs with the Bangladesh Power Development Board (BPDB) in Dhaka.

In his tweet, Karan Thapar stated, Narendra Modi committed credit of Rs 10 thousand crore when he visited Nepal. He committed Rs 4.5 thousand crore to Bhutan, Rs 6400 crore to Mongolia and  Rs 12 thousand 800 crore (USD 2 billion) credit to Bangladesh. Adani has signed MOUs for power projects in each of these countries.

Adani generates 10,480 MW of electricity in India at present, but has not done any power project outside of India so far. Normally a company is required to have experience in setting up power plants abroad, singly or jointly, before they take up such projects outside of their own country.

According to ministry sources, Reliance has long bee endeavouring to set up a 3000 MW power plant in Bangladesh fuelled by costly imported LNG (liquefied natural gas).  It said initially t would set up a 2250 MW power plant then add another 750 MW later.

Reliance has a 2250 MW LNG-fired newly built power plant in the Indian state of Andhra Pradesh, but with costs of LNG makes the electricity price too high for the Indian market. They cannot run the power plant and possibly they are now trying to transfer that to Bangladesh. It is speculated that political patronage exists in this case too.

Power ministry sources feel that these projects will not be implemented eventually. There is need for a consensus on location, cost of electricity an other issues for such projects.

While signing the MOUs with Adani and Reliance on Saturday, power secretary Manwar Islam, however, expressed hope that the projects would be speedily implemented.  Addressing the Adani and Reliance officials he said please don’t disappear after signing the MOU, as many companies have done in the past. The government ants these projects to be implemented speedily.

The question is whether initiative can be taken to implemented any large power plant project based on unsolicited proposals of foreign companies, in the light of the special act of 2010 concerning quick supply of power and energy.

Energy Regulatory Commission (BERC) member and Dhaka University law department teacher Selim Mahmud said, the law does not mention the size of the project o whether the implementing company is to be local or foreign. So if the government wants, it can give large projects to foreign companies.

However, former power and energy affairs assistant to the chief advisor of the caretaker government, M Tamim, told Prothom Alo, no law can simply be interpreted literally. The aim, context and requirements of the the concerned law must be taken into cognizance. That particular law was made to save the country from a serious power crisis within the shortest time possible. That is why small quick rental power plants were set up under that law.

M Tamim said the government has successfully overcome that crisis. Now the government is implementing mid and long term plan. The need for “quick supply” as mentioned in the law is no longer the priority. Base load plants should not be given priority. This does not include 3000 M LNG-fired power plants. Adani’s proposed 1600 MW coal-fired power plant for speedy supply of power is also not applicable. Actually the time for power plants under that law has passed long ago.

Certain officials of the power ministry said the government in the past never even considered such huge unsolicited power projects in the past as proposed by Reliance and Adani. These suddenly appeared in the the scene. These were no connected with the Indian prime minister’s visit. And in the joint statement of the two prime ministers concerning power and energy projects, these particular projects were not mentioned.

Published from Dhaka…..


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