Sri Lankan lawmakers accuse Adani of promoting India's interests in the island

Gautam Adani's plans to build renewable power plants on the coast of Pooneryn in northern Sri Lanka have landed amid a controversy. The region is close to India's southern peninsula and it is the livelihood of fishermen on the island.

Sri Lankan lawmakers have accused the Adani Group of signing port and energy deals that serve India's interests.

The island nation is a major investment ground for China and New Delhi is not happy with Beijing having control over key global shipping lanes that give it access to India's southern borders. Adani's port deals are being criticised for having the intention of competing with China.

The Adani Group has consistently denied the allegations and said its investments are good for Sri Lanka's current requirements. Billionaire Gautam Adani has also denied that his company receives special treatment from the Modi government.

In October 2021, Adani met with then-Sri Lankan President Gotabaya Rajapaksa after signing a $750 million Colombo port deal. China was previously the biggest player in Sri Lanka's infrastructure investments. Adani also spoke of the strong bonds between Sri Lanka and India.

Following this, Adani's team set eyes on the north region of the island nation which hasn't seen any investment since the end of the 26-year civil war in 2009. It was for a $70 billion green energy project. Soon after this, the Rajapaksa administration terminated Chinese solar projects. India's security concerns related to the islands on the Palk Strait played a key role in this. Earlier this year, Adani signed MoUs to build renewable energy projects in Pooneryn and Mannar, Sri Lanka's northern district close to India.

After the local media reported the deal, Ajith Perera, the chief executive of Sri Lanka's largest opposition party the Samagi Jana Balawegaya, called it Adani's back door entry to the country's energy industry. He also wrote on social media that the Rajapaksa's administration was "pampering" Prime Minister Modi's "notorious friends."

Another prominent SJB lawmaker Eran Wickramaratne said such a deal must be transparent and bid out. He also alleged that the parliament was not allowed to scrutinise the contract. However, he said the blame lies with Sri Lanka's government and not the "foreign investment." Later, the chairman of the state-run utility said the Modi government pressured the Sri Lankan government into accepting Adani's proposals. He withdrew the claim a few days later and resigned.

Colombo also saw some protests with signs reading "stop Adani" and "Modi don't exploit our crisis".

Experts think Adani's actions are to advance the Modi government's objectives in Sri Lanka. "In countries where the Indian government has better relations than the Chinese government, Adani could find success," said Akhil Ramesh of the Pacific Forum research institute in Honolulu to Bloomberg. Adani's investments can help India compete with China's state-owned firms.

Katharine Adeney, a professor and expert on South Asian politics at the University of Nottingham, said India is worried about Chinese access to the Indian Ocean, and being encircled by Chinese-friendly regimes in Pakistan, Sri Lanka, and Bangladesh.

Adani also criticised China recently and said the country is "increasingly isolated" with Belt and Road facing "resistance." China has been investing billions in South Asia via the Belt and Road Initiative. But the Sri Lankan economic crisis put Colombo in need of food, fuel, and medical assistance from India.

Bhavani Fonseka, a senior researcher and lawyer at the Colombo-based Centre for Policy Alternatives, opined that Adani's renewable moves "didn't get the attention it should have" amid Sri Lanka unrest. The relative calm that has developed now may create a chance of reexamination, reported Bloomberg.