In return for a 30-year lease, the Adani Group agreed to modernize the passenger terminal and construct a second runway at Jomo Kenyatta International Airport.
Following the indictment of its founder in the United States, Kenyan President William Ruto has said that he has ordered the cancellation of a procurement process that was supposed to give India’s Adani Group control of the nation’s principal airport.
The Adani Group intended to rebuild the passenger terminal and add a second runway at Jomo Kenyatta International Airport in exchange for a 30-year lease under the proposed agreement, which was valued at around $2 billion.
A separate 30-year, $736-million public-private partnership agreement that an Adani Group company had signed with the energy ministry last month to build power transmission lines was also canceled by Ruto on Thursday.
Ruto attributed the decision to “new information provided by investigative agencies and partner nations” in his state of the nation address. “I have directed agencies within the ministry of transport and within the ministry of energy and petroleum to immediately cancel the ongoing procurement,” he said.
Lawmakers in parliament, where Ruto delivered his speech, cheered and applauded his news.
Many lawmakers and members of the public have sharply criticized the accords, citing worries about their lack of transparency and value for money.
A request for comment was not immediately answered by Adani Group representatives.
One of the wealthiest individuals in the world, Gautam Adani, and seven other defendants agreed to pay around $265 million in bribes to Indian government officials, according to the indictment released by US investigators on Wednesday.
“Not worth the money”
In a statement, the Adani Group stated it will pursue “all possible legal recourse” and refuted the accusations.
The airport project was submitted by the Adani Group in March via a process that avoids competitive bidding, but it wasn’t made public until July due to a social media leak.
In response to a complaint claiming it did not provide taxpayers with value for their money, a Kenyan court temporarily halted it in September.
Despite claims of poor governance standards at the business made by US short-seller Hindenburg Research in 2023, which the Adani Group refuted, senior government officials, including Ruto, had always defended the accords.
Energy Minister Opiyo Wandayi informed senators as late as Thursday morning that he anticipated the transmission lines contract will proceed because there was no corruption or bribery in its awarding.
According to George Kamau, a Kenyan attorney who specializes in public procurement, the Adani Group may contest the cancellations in arbitration, particularly with regard to the already signed transmission lines agreement.
“That said, any dispute resolution framework is likely to lean towards the state, considering the fact that the deal has been cancelled on the basis of integrity issues,” he stated.
