Bangladesh Hires UK law Firm in Adani Power Dispute

Bangladesh has appointed a leading British law firm to represent the state in its legal dispute with India’s Adani Power Limited, marking a major escalation in efforts to challenge the controversial power purchase agreement.

The Bangladesh Power Development Board (BPDB) has hired 3 Verulam Building, a UK-based legal chambers led by King’s Counsel Farhaz Khan, to represent the government in mediation proceedings at the Singapore International Arbitration Centre (SIAC). The dispute centres on coal pricing and electricity tariffs under a long-term contract.

The Power Division said Farhaz Khan is already familiar with the case, having previously advised Bangladesh’s National Review Committee on power sector agreements signed during the former government’s tenure.

Two Bangladeshi experts have also been appointed to assist the legal team at SIAC: Rezwan Khan, chairman of Power Grid Bangladesh, as a technical expert, and Barrister Ehsan Abdullah Siddiq, partner at The Law Counsel, as a legal expert.

The 25-year power purchase agreement, signed in 2017, involves the supply of 1,496 megawatts of electricity from Adani’s coal-fired plant in India’s Jharkhand state. Following a review by the National Review Committee, the government estimates Bangladesh is overpaying between $400 million and $500 million annually due to flaws in the coal pricing formula.

Power and Energy Adviser Fouzul Kabir Khan has said investigators found both direct and circumstantial evidence of bribery linked to the deal, including suspicious financial transactions through foreign bank accounts. Officials believe there may now be sufficient grounds to pursue a fraud case.

Adani Power initiated arbitration at SIAC last year, claiming $485 million in unpaid dues. While the company pushed for immediate mediation, Bangladesh delayed the process until the review committee completed its assessment. Under the contract, mediation is mandatory but non-binding and serves as a step before full arbitration.

According to the review committee’s report, dated January 20, electricity from Adani’s Godda plant is priced nearly 40 percent higher than its closest private-sector competitor in India. The committee described the contract as the most expensive cross-border power deal in Bangladesh’s portfolio and flagged serious procedural anomalies in how the agreement was awarded.

The report also said the Adani plant uses overpriced coal and passes Indian corporate taxes on to Bangladesh, a practice it said deviates from international norms, where power producers typically bear their own domestic tax liabilities.

Adani Power said it could not comment on the findings as it was not consulted during the review and had not received a copy of the report. The company added that it continues to supply electricity despite outstanding payments and urged Bangladesh to clear its dues, citing operational pressures.

Separately, Bangladesh has secured a legal victory in another long-running energy dispute. The International Centre for Settlement of Investment Disputes (ICSID) has ordered Canadian firm Niko Resources to pay $42 million in compensation for gas well blowouts at the Chhatak field in 2005.

The government said the ruling reinforces its position in holding energy companies accountable for financial losses and environmental damage.