Adani Power, a subsidiary of billionaire Gautam Adani’s vast conglomerate, is currently facing a significant financial dispute with Bangladesh, which owes the company approximately $800 million in unpaid dues. This substantial amount stems from electricity supplied by Adani Power’s coal-fired plant in Godda district, Jharkhand. The dispute comes at a tumultuous time for Bangladesh, which has been grappling with violent protests and political instability.

Bangladesh’s newly-appointed central bank Governor, Ahsan H. Mansur, confirmed the outstanding debt in an interview with Bloomberg News. Mansur indicated that failure to settle these dues could potentially lead to Adani Power halting its electricity supply to the country. “If we don’t pay them, they will stop providing electricity,” Mansur warned.

Although Adani Power has yet to take steps to cut off electricity supply, the company faces mounting pressure from its lenders and coal suppliers due to the unpaid amount. Internal discussions reveal that the company is actively negotiating with Bangladesh’s interim government to resolve the issue.

An Adani Group representative did not immediately respond to inquiries regarding the unpaid dues. The company’s current stance is to seek a resolution through dialogue with the interim administration in Bangladesh.

The situation highlights the broader financial and geopolitical risks associated with Adani Group’s international operations. The conglomerate has been expanding its presence in South Asia, including neighboring countries such as Sri Lanka, Bhutan, and Nepal. This expansion often aligns with Indian Prime Minister Narendra Modi’s regional policy priorities.

Gautam Adani had previously praised the Godda power project and its role in Bangladesh’s development, highlighting his support for the then-Prime Minister Sheikh Hasina’s vision. The power plant, which began commercial operations in April 2023, was seen as a key component of the energy infrastructure between India and Bangladesh.

In addition to Adani Power, other Indian state-owned companies, such as NTPC Ltd. and PTC India Ltd., also supply electricity to Bangladesh. It remains unclear whether these companies are facing similar issues with unpaid dues.

Bangladesh’s economic situation is precarious, with overall arrears reaching up to $2 billion. The country is contending with an ongoing economic crisis exacerbated by student-led protests that led to political upheaval and the installation of an interim government. The new administration, which includes assistance from the military, is working to stabilize the country amid these challenges.

The nation’s foreign exchange reserves are dwindling, with gross reserves totaling $20.5 billion as of July 31, sufficient for only about three months of imports. The interim government is seeking additional financial support from the International Monetary Fund (IMF) beyond an existing $4.7 billion program to address the economic difficulties.

“The message is that we need money,” said Mansur. “We want to clear all the arrears.” The interim administration’s efforts to manage the crisis include addressing both domestic financial obligations and international debts.

This dispute with Adani Power is a significant aspect of the broader economic challenges facing Bangladesh, reflecting the complex interplay between financial stability and geopolitical relations in the region.