The Sri Lankan government has launched an investigation into local projects undertaken by India's Adani Group following bribery charges filed in the United States against its founder, Gautam Adani.
Government spokesperson and Health Minister Nalinda Jayatissa stated that the finance and foreign ministries have been tasked with reviewing the infrastructure projects awarded to the Indian conglomerate. "We will take a decision about these projects based on the two reports we have commissioned," he said.
This investigation follows allegations by US prosecutors that Adani paid over $250 million in bribes to Indian officials to secure solar energy supply contracts. While Adani has dismissed these charges as "baseless," the accusations have prompted global scrutiny, with countries like Kenya cancelling deals with the conglomerate.
The Adani group was one of the first foreign investors to enter Sri Lanka following its economic collapse in 2022. Among its projects is a $442 million wind power project in Mannar, approved in early 2023 under the previous administration. However, the initiative has faced delays due to environmental concerns and a legal challenge.
Additionally, the Colombo West International Terminal (CWIT), a deep-water port project valued at over $700 million, is being developed by Adani Ports in collaboration with John Keells Holdings and the Sri Lanka Ports Authority. Funded partially by a $553 million loan commitment from the US International Development Finance Corporation (DFC), the project is slated to begin operations in early 2025. However, DFC officials quoted in the Mint have clarified that no funds have been disbursed yet, as the project is still under review to meet their due diligence standards.
Adani is also planning a large-scale renewable energy project in Sri Lanka's Northern and Eastern provinces, drawing criticism from local communities and environmentalists. Concerns have been raised about the potential ecological and social impact of the project, including its effect on coastal fishing and bird populations.
Despite these challenges, Sri Lanka’s Ceylon Electricity Board (CEB) plans to invite bids for two additional offshore wind farms in Mannar and Puttalam, each with a capacity of 500 MW. Feasibility studies are expected to conclude by 2027, with construction likely to begin in 2028. CEB Chairman Tilak Siyambalapitiya noted that the Mannar site offers superior wind energy potential compared to Puttalam, though offshore development costs remain significantly higher.
Siyambalapitiya was quoted in the Economy Next stating that the CEB has to make detailed environmental studies, sea floor, and logistics before calling for bids, Siyambalapitiya told a forum organized by Sri Lanka’s Export Development Board. "The Mannar site is substantially superior in energy yield compared to Puttalam," he said. It will be about 100 kilometres off shore, but wind turbines could be planted on the sea floor while power will be brought to the shore by cables with no offshore grid substation and connected to the grid.
The existing Mannar wind farm, built with Asian Development Bank funding, has implemented bird radar systems to mitigate risks to migratory birds. Similar measures are expected for future projects, though challenges such as bird collisions with transmission lines and the impact of coastal fishing activities persist. Offshore development will also have to address the issues of birds, he said and mitigatory actions carried out. “Obviously we will have radars. More radars as well and similar mitigatory measures will have to be adopted,” Siyambalapitiya said.
Earlier this year, environmentalists took Adani to court over flawed Environment Impact Assessment reports. Two fundamental rights petitions were been filed in Sri Lanka’s Supreme Court challenging the Adani Green Energy Wind power project proposed for Mannar. The first case was filed on May 17 by the Wildlife and Nature Protection Society (WPNS), while the Centre for Environmental Justice filed its petition on June 5. This petition has been filed by three environmentalists Rohan Pethiyagoda, Prof. Nimal Gunathilleke, and Prof. Sarath Kotagama along with Bishop of Mannar Rev. Fr. Bastian.
The petition has been filed under public interest, challenging the procurement and construction of the proposed 250 megawatts Mannar Wind Power project which was awarded to Adani Green Energy. The case names 67 respondents including the Cabinet of Ministers, the Sri Lanka Sustainable Energy Authority, the Central Environment Authority, the Attorney General, and several others.
