Adani’s Ultimatum and Bangladesh’s Debt Crisis
In a recent escalation of financial disputes, Adani Power Jharkhand Limited has threatened to completely halt its electricity supply to Bangladesh by November 7, unless outstanding dues are settled. This drastic step follows a reduction of supply by 50%, from the Jharkhand-based Godda power plant, due to a debt of around $850 million owed by the Bangladesh’s Power Development Board (BPDB). As Bangladesh grapples with a severe dollar shortage, its failure to meet the payment deadlines exacerbates the energy crisis it already faces.
Moreover, Adani Power’s request for a $170 million letter of credit as payment security remains unmet, with BPDB’s attempts to secure this through Krishi Bank falling short of the power purchase agreement’s terms. This situation places Bangladesh in a precarious position, risking not just immediate power shortages but also long-term energy reliability.
Bangladesh’s Strategic Pivot in Textile Exports
Simultaneously, Bangladesh has decided to reroute its textile exports through the Maldives, bypassing India. This move not only impacts India’s cargo revenue from airports and ports but also signifies a potential shift in the economic rapport between the two nations. Originally, these exports passed through Indian logistics channels, contributing significantly to revenue and enabling timely global deliveries.
This strategic shift could reduce collaborative potential in logistics and infrastructure projects between India and Bangladesh and suggests a growing inclination in Dhaka to decouple economically from India, revealing underlying anti-India sentiments. Furthermore, it seems to underscore the Bangladeshi government’s intention to shift blame and overlook the true causes of delays, such as the internal chaos and the persecution of Hindus.
The Underlying Friction
This series of events underscores a broader narrative where Bangladesh appears to divert blame for its internal challenges onto India. Despite India’s longstanding role as a supportive neighbor—facilitating Bangladesh’s economic rise through strategic sacrifices in its regulatory policies—gratitude remains scarce. The current government in Bangladesh seems intent on forging a path that positions India as an enemy rather than a partner.
India, for its part, has exhibited considerable patience. Companies like Adani have extended significant credit terms and energy support to Bangladesh, expecting mutual respect and financial diligence. Yet, the response has been less than cooperative, straining not just business relations but also diplomatic ties.
Rethinking India’s Approach
As Bangladesh continues to navigate its economic and political instabilities by redefining its alliances and trade routes, it is perhaps time for India to reassess its approach. The notion of self-sacrifice for neighborly benefit has its limits, especially when it compromises India’s own economic interests.
The ongoing situation serves as a reminder to Indian policymakers and private sectors alike that while kindness in international relations is commendable, it must not lead to one-sided dependencies or unreciprocated commitments. It is time for a new strategy that may be necessary—a strategy that prioritizes India’s interests equally alongside its neighborly duties.