A U.S. agency that agreed to lend more than $500 million to a Sri Lanka port development backed by the Adani Group said it is still conducting due diligence on the project in the wake of bribery allegations against the group’s billionaire founder Gautam Adani and other top executives, Bloomberg News reported on Sunday.
The U.S. International Development Finance Corporation has not reached a final agreement on the loan, an official with the agency said in an email to Bloomberg.
“We continue to conduct due diligence to ensure that all aspects of the project meet our rigorous standards before any loan disbursements are made,” the official said, according to the report.
Last November, the agency said it would provide $553 million in financing for the port terminal project in Colombo, the capital of Sri Lanka. The project is partly owned by India’s Adani Group. The joint funding was seen a strategic move to curtail the growing Chinese influence in Sri Lanka.
But last week, the U.S. authorities charged Adani and seven other people with agreeing to pay bribes to Indian government officials to obtain contracts that could yield $2 billion of profit over 20 years as well as to develop India’s largest solar power project.
The Adani Group has said the accusations as well as those levelled by the U.S. Securities and Exchange Commission in a parallel civil case are “baseless and denied” and that it will seek “all possible legal recourse.”
But the allegations have already led to Kenya cancelling a contract given to the Adani Group to upgrade Nairobi airport, and calls in Australia for the cancellation of a coal mining contract in Queensland.
Although both deals, particularly the Kenya airport one reportedly faced significant local opposition even before the U.S. indictment, some reports allege the Kenya cancellation and the protests in Australia are due to American pressure.
(With inputs from Reuters)
