Bangladesh is facing a severe power crisis due to the government’s failure to clear dues owed to various power producers, including India’s Adani Group. The country’s state-owned power development board, Bangladesh Power Development Board (BPDB), owes a staggering Tk 43,473 crore (approximately $5.2 billion) to independent power producers (IPPs). This includes Tk 10,309 crore owed to Adani Power, a subsidiary of Gautam Adani-led Adani Group.
The crisis is exacerbated by the approaching summer season, when power demand is expected to surge exponentially. The Bangladesh Independent Power Producers Association (BIPA) has issued an ultimatum to the government to clear pending dues or face a shortfall of 3,500-4,000 megawatts in the coming months. If the government fails to clear the dues, it will be impossible to open letters of credit (LCs) to import fuel needed for power generation.
The situation is further complicated by the fact that the government has not released an official demand-supply forecast for the upcoming season. A senior BPDB official claimed that the actual dues to IPPs are less than what is being reported, but the government is prioritizing full-scale power generation from coal-fired power plants this summer.
Adani Power has already reduced electricity supply to Bangladesh by 60% due to non-payment of bills amounting to over $800 million. The company has been seeking to recover the pending dues, which has led to a reduction in power supply to Bangladesh.
The power crisis is not the only issue affecting Bangladesh-India relations. The ouster of former Prime Minister Sheikh Hasina and the installation of an interim government led by Nobel laureate Muhammad Yunus has soured ties between the two countries. The Indian government has accused the Yunus-led interim government of not doing enough to stop widespread communal violence against minorities in Bangladesh, particularly Hindus.