The United States International Development Finance Corporation (DFC), a key financier of the Colombo Port terminal project in Sri Lanka, is conducting rigorous due diligence following allegations against Adani Group Chairman Gautam Adani by the U.S. Department of Justice. The DFC has yet to finalize a $500 million loan agreement with the Adani-led consortium, according to a Bloomberg report.
“We continue to conduct due diligence to ensure that all aspects of the project meet our rigorous standards before any loan disbursements are made,” a DFC spokesperson told Bloomberg. The agency further clarified, “The project has not reached financial close or signed a loan agreement.”
The scrutiny comes after Adani and six associates were indicted on charges of fraud linked to a $250 million bribery scheme. The allegations have cast a shadow over Adani’s multinational projects, prompting the Kenyan government to cancel a $2.5 billion deal with the group for electricity transmission upgrades and the management of Nairobi’s Jomo Kenyatta International Airport.
Adani Group’s Role in Sri Lanka
The Adani Group secured the contract to develop the Colombo Port terminal in 2021. The project is a joint venture with John Keells Holdings and the Sri Lanka Ports Authority (SLPA), with Adani holding a majority stake. Initially estimated at $700 million, the project represents a strategic counterbalance to Chinese investments in Sri Lanka, including the Colombo International Container Terminal (CICT) and the Hambantota Port.
In November 2023, the DFC announced plans to provide a $553 million loan for the Colombo Port terminal, aligning with U.S. efforts to mitigate China’s influence in the region. However, the project now faces additional scrutiny under Sri Lanka’s new administration led by President Anura Kumara Dissanayake.
During his election campaign, President Dissanayake pledged to reassess approvals granted to Adani Group projects, including a wind power initiative sanctioned by the previous government. Even before the U.S. allegations, Adani’s projects in Sri Lanka were under review, with concerns raised in the country’s Supreme Court.
The unfolding developments highlight growing global and local challenges for the Adani Group, as its ventures come under increased scrutiny amid mounting legal and political pressures.
Source: Outlook Business
