Adani Ports and Special Economic Zone (APSEZ) has decided to withdraw its request for a $553 million loan from the US International Development Finance Corporation (DFC) for the development of the Colombo West International Terminal (CWIT) in Sri Lanka. The company confirmed this decision in an exchange filing on Tuesday, stating that the project will now be funded through internal accruals and its capital management plan.
The loan agreement was signed last year as part of the US’s strategic push to offer developing countries alternatives to Chinese infrastructure investments. While the reason behind withdrawing the loan request was not explicitly mentioned, the decision appears to be linked to recent developments surrounding Adani Group.
In the past month, the US Department of Justice and the Securities and Exchange Commission indicted Gautam Adani, his nephew Sagar Adani, and six other executives for allegedly paying $265 million in bribes to Indian government officials to secure solar power contracts. The charges claim the bribes were disguised as “development fees” to ensure Adani Group’s success in obtaining state electricity distribution company contracts. The indictment also includes accusations of making false statements to US investors regarding the company’s anti-bribery practices.
Although the Adani Group has denied the charges, calling them baseless, the DFC announced that it was reviewing the impact of the allegations on its investment decision. The loan for the Colombo terminal project had not yet been disbursed.
This controversy surrounding Adani has sparked significant political debate in India, where opposition parties have accused Prime Minister Narendra Modi of favoring the industrialist. The issue has drawn widespread attention as Gautam Adani remains one of the wealthiest individuals in Asia.
