The Bangladesh High Court on Wednesday stopped arbitration proceedings in Singapore between the Bangladesh Power Development Board (BPDB) and India’s Adani Power over disputes on power supply payments.
Adani Power and the BPDB have been in conflict over pending dues under the power supply agreement signed in 2017. Both sides had earlier this month agreed to pursue international arbitration to settle the dispute.
The court said the arbitration will remain on hold until a high court-appointed committee submits its report on the fairness and any possible irregularities in the agreement between the Bangladesh government and the Adani Group. Last year, the court ordered a review of the contract by a committee of experts.
Adani Power supplies electricity to Bangladesh from its coal-fired 1,600 megawatt Godda plant in eastern India, which provides nearly a tenth of Bangladesh’s power demand.
"If Adani starts arbitration proceedings in Singapore over their dues before the investigation report comes, then the investigation will have no importance," Abdul Qayyum, a lawyer who filed the injunction petition, told reporters.
The interim government in Bangladesh had accused Adani of breaching the power purchase agreement by withholding tax benefits received by the Godda plant from India, Reuters reported in December.
During the fiscal year to June 30, 2024, Bangladesh paid Adani a tariff of 14.87 taka ($0.1220) per unit, compared with an average 9.57 taka paid for power supplied by other Indian companies.
An Adani Group spokesperson said in a statement that the company had not yet reviewed the order, and added that as per the agreement, disputes must be settled through the Singapore International Arbitration Centre, which is not under the jurisdiction of Bangladesh courts.
