An Unbalanced Power Deal – Bangladesh Must Revisit the Adani Power Deal—Firmly and Fairly
The power agreement between Adani Group and Bangladesh has become a cautionary tale of how strategic decisions, when taken without sufficient scrutiny, can deepen economic vulnerability rather than resolve it.
What was presented as a solution to Bangladesh’s energy shortage has instead exposed structural weaknesses in policy planning, transparency, and long-term financial foresight.
Signed in 2017, the deal commits Bangladesh to purchase power for 25 years from Adani’s coal-fired plant in Godda, India, through the Bangladesh Power Development Board. Since then, energy markets have shifted dramatically.
Coal prices have spiked, renewables have become cheaper, and Bangladesh’s own power mix has diversified.
Yet the country remains locked into high capacity charges and dollar-denominated payments that strain foreign-exchange reserves and public finances.
Electricity purchased from Adani’s coal-fired plant has proven significantly more expensive than power generated domestically.
Compounding this burden is the capacity payment clause, which obliges Bangladesh to pay even when the electricity is not fully utilised.
In an economy already under strain, such rigid financial commitments leave little room for manoeuvre.
The decision to denominate payments largely in US dollars further aggravated the situation.
During Bangladesh’s recent foreign exchange crisis, dollar shortages made timely payments difficult, triggering supply reductions and public anxiety.
This highlighted a deeper flaw: excessive dependence on a foreign supplier using imported fuel, exposing the country to global price shocks and geopolitical risk.
Equally troubling is the lack of transparency surrounding the deal.
Signed without open competitive bidding, the agreement has raised persistent questions about accountability and whether national interest was adequately protected.
Energy policy, especially one binding the country for decades, demands openness, competition, and rigorous cost-benefit analysis.
Bangladesh’s experience with the Adani agreement underscores a vital lesson. Energy security cannot be achieved through expensive, opaque contracts that compromise financial sovereignty.
As the country looks ahead, it must prioritise renegotiation, diversification of energy sources, and greater investment in domestic and renewable power—ensuring that future agreements empower, rather than encumber, the nation’s economic future.