The High Court on Tuesday directed the interim government to establish a high-powered committee of international experts in energy, fuel and legal matters to investigate the controversial power purchase agreement signed with India’s Adani Power in November 2017 during the regime of the now deposed Awami League.
The bench of Justice Farah Mahbub and Justice Debasish Roy Chowdhury instructed the secretary of the Energy and Mineral Resources Division to form the committee within 30 days and produce a detailed report within two months of its formation.
The court set February 25 for further orders on the matter.
It also directed the chairman of the Bangladesh Power Development Board to provide any documentation on negotiations that took place prior to the agreement signed on November 5, 2017.
The court also ordered the authorities to investigate whether due process was followed in signing the deal and submit a report within 30 days.
The directive came in response to a public interest writ petition filed by Supreme Court lawyer Md Abdul Qaium Liton on November 12.
The petitioner lawyer alleged serious irregularities in the agreement, which was negotiated under the direct supervision of then prime minister Sheikh Hasina, who was also the energy minister, and Indian prime minister Narendra Modi, and claimed that it violated Section 13 of the Procurement Act, 2006.
The act mandates that all procurement, particularly by state entities, must be conducted transparently and through a competitive process.
During the hearing, the court emphasised prioritising Bangladesh’ national interest, stating that India as a neighbouring country should also take this issue into account.
The High Court issued a ruling asking the government authorities to explain within four weeks why the BPDB-Adani (Jharkhand) Limited power purchase agreement, allegedly detrimental to Bangladesh’s public interest, should not be declared illegal.
It also sought clarification on why the deal should not be scrapped.
Respondents to the ruling include the BPDB chairman, the managing director of Power Grid Company of Bangladesh, the chairpersons of the Bangladesh Energy Regulatory Commission and the Anti-Corruption Commission, and Adani (Jharkhand) Limited.
The Adani power deal has drawn widespread criticism for its alleged potential for harming Bangladesh’s energy sector and lack of transparency with growing calls for accountability and reform.
The power purchase agreement, better known as PPA, allowed Adani Power to generate electricity in its 1,600MW Godda power plant in India by burning coal with comparatively lower quality, while charging Bangladesh for a higher quality coal.
At the plant Adani burned coal with a calorific value of 4,600kcal/kg, but charged Bangladesh for coal carrying the higher calorific value of 6,322 kcal/kg, creating significant cost discrepancies.
The deal with Adani Power has come under intense scrutiny with critics highlighting its role in driving up electricity prices by as much as 8 per cent.
The agreement has drawn comparisons to electricity purchased from India’s exchange market, which costs nearly half as much as power from Adani’s 1,600MW coal-fired plant.
In 2023, Bangladesh bought power from Adani at Tk 14.02 per kilowatt-hour, while it purchased 1,100 MW from India’s electricity exchange market at just Tk 7.83 per unit.
The Adani power plant, built without public disclosure, was exclusively dedicated to supplying Bangladesh until the recent political shift as a result of which Sheikh Hasina resigned as prime minister and fled to India on August 5 driven by a student-mass uprising.
Shortly afterward, the Indian government permitted Adani Power to sell electricity in its domestic market as well.
Energy experts, including M Shamsul Alam, vice president of the Consumers Association of Bangladesh, called for a thorough review of the deal.
Describing it as unsolicited and heavily skewed in favour of Adani, Shamsul Alam criticised the lack of competitive bidding and argued that the agreement heavily undermined Bangladesh’s national interest.
‘When procurement costs rose, the state-owned Power Development Board simply passed the burden onto consumers, forcing them to pay exorbitant prices. Here, the government itself appears to be profit-driven,’ Shamsul added.
The High Court also dealt a critical blow to the controversial Quick Enhancement of Electricity and Energy Supply (Special Provision) Act, 2010, which allowed power deals to bypass competitive bidding.
On November 14, the court invalidated two core provisions of the law, dismantling mechanisms that enabled opaque procurement processes and indemnity for officials involved in energy projects.
The law, originally set to expire, was extended in 2021 for another five years, despite widespread concerns over its lack of transparency. It had permitted deals related to electricity generation, transmission, and fuel imports to proceed without tenders, drawing significant criticism.
The same High Court bench struck down Section 6(2), which authorised the Ministry of Power, Energy and Mineral Resources to submit procurement proposals directly to the purchase committee with only the energy minister’s approval.
The court also nullified Section 9, which provided indemnity to officials from legal accountability for actions taken under the act, declaring it unconstitutional.
The court’s ruling clarifies that government authorities are now free to review, reassess, and, if necessary, take action against any contracts or decisions made under these provisions.
The verdict permitted legal action against officials if corruption or irregularities are identified.
The judgment, delivered in response to a writ petition filed by Shahdeen Malik and his colleague Tayeb-Ul-Islam Showrov on August 28, marks a pivotal moment in Bangladesh’s energy governance.
By dismantling these provisions, the High Court has opened the door for greater transparency and accountability in the energy sector, addressing long-standing concerns over procurement practices.
Senior lawyer Shahdeen Malik, the main petitioner in the writ, argued that the indemnity provision caused a staggering loss of Tk 1 lakh crore in public funds.
New Age
