Days after Adani Green announced quitting from a controversial renewable energy project in Sri Lanka, President Anura Kumara Dissanayake said awarding energy projects at an “excessive tariff” of $8.26 cents “cannot be justified”. 
| Photo Credit: Reuters

Days after Adani Green announced quitting from a controversial renewable energy project in Sri Lanka, President Anura Kumara Dissanayake said awarding energy projects at an “excessive tariff” of $8.26 cents “cannot be justified”. While welcoming energy investments based on a competitive tariff, Sri Lanka will not privilege a specific company or country, he said on Monday (February 17, 2025), without naming Adani or India.

Mr. Dissanayake’s statement, made during his maiden Budget speech in Parliament, is Sri Lanka’s first official reaction to the company’s decision, conveyed to Sri Lanka’s Board of Investment in a letter dated February 12, 2025. Citing another project signed recently with a local company, Mr. Dissanayake said: “We awarded a tender to a 50MW wind power project at $4.65 cents for a unit of electricity. In that context, awarding projects at an excessive tariff around $8.26 cents cannot be justified.”

He further added: “To provide energy at a competitive cost to industries, exporters, and consumers, we will welcome energy investments based on the lowest tariff, and we will not provide preferential treatment [based] purely on the company or the country of origin.”

Meanwhile, Sri Lankan Foreign Minister Vijitha Herath also told The Hindu on Monday (February 17, 2025) that the withdrawal of Adani Green from the power project did not arise due to a change in government, but because of the “very high tariff” negotiated with the previous Wickremesinghe government. He emphasized, however, that the Adani group’s decision had come as a surprise to the Sri Lankan government, as it was still in the process of review at the time. 

“We had not taken any decision so far. This [withdrawal] was the decision of the [Adani] group company. I don’t know what is the reason behind their decision…they just sent an email to our Board of Investment. As a government, we have not discussed it yet,” said Mr. Herath, who was in Muscat for the 8th Indian Ocean Conference.

Sri Lanka’s leading business newspaper, the Daily Financial Times, said in its editorial on Monday: “Adani exit from renewable energy projects a victory for transparency”.

Legal challenge

According to sources familiar with the project, “another big concern” for the Adani wind power project in Mannar and Pooneryn in northern Sri Lanka, is that at least five petitions on human rights, land rights, and environmental concerns are set to be heard by Sri Lankan courts this year.

In the past few months, the Adani group has faced similiar setbacks in other countries, particularly after changes in their government – in Dhaka, the Yunus government is reviewing tariffs on the Adani Jharkhand power project, indictments were filed against the group by the US Department of Justice in 2024 over a bond issue, and the Kenyan government scrapped contracts for Nairobi airport and power infrastructure in the country.

Speaking at the same conference in Muscat, hosted by the Indian and Omani foreign ministries and organised by the India Foundation, Adani Ports and SEZ CEO Ashwani Gupta defended the company’s practices. When asked if the company was considering revising its contract negotiation process to factor in the political changes, Mr. Gupta said that they consult “all stakeholders” in their international projects. “Wherever we go, we go with a very important objective, which is top-line growth and the bottom-line growth. We have to collectively work with all the stakeholders, and we do that as a matter of principle,” he said, responding to a question from The Hindu.

From the time of its conception and approval in Sri Lanka — without a competitive bid — Adani Green’s 484 MW wind power project has been mired in controversy, as locals, environmentalists and transparency watchdogs mounted fierce resistance, including at Sri Lanka’s top court. The legal challenges to it were on grounds of transparency and environmental impact.

The company’s call to withdraw the project came amid Sri Lanka’s emphasis on the need to renegotiate the “very high” tariff. In January this year, the Dissanayake administration revoked the 2024 power purchasing agreement inked with the company by the predecessor Ranil Wickremesinghe government. Sri Lanka had then agreed to purchase power at $0.0826, or 8.26 cents, per kWh from Adani Green. In an ongoing Supreme Court case, the Dissanayake government has said it will review the project, although Mr. Dissanayake during his election campaign vowed to cancel the “corrupt project”.

Vijitha Herath (left), who served as Foreign Minister in President Anura Kumara Dissanayake’s interim government, was on Monday [November 18, 2024] sworn in as Foreign Minister in Sri Lanka’s new Cabinet, installed after the November 14 general election.
| Photo Credit: Special Arrangement

Sri Lanka’s President Anura Kumara Dissanayake, who assumed office in September, will undertake his first state visit abroad to India mid-December, Foreign Minister Vijitha Herath has said.

Mr. Herath made the remark to local media on Monday, soon after President Dissanayake installed Sri Lanka’s new Cabinet following his party’s big win in the November 14 general elections. A date is yet to be fixed for the visit. Colombo and New Delhi are in the process of working out a mutually convenient schedule, sources said.

External Affairs Minister S. Jaishankar visited Sri Lanka early in October and extended Prime Minister Narendra Modi’s invitation to President Dissanayake. Mr. Dissanayake’s interim government reportedly conveyed that high-level visits would be considered after the conclusion of the parliamentary polls. The general election was crucial for his government to consolidate power in the legislature. The ruling National People’s Power has won a historic mandate, securing more than a two-thirds majority.

Meanwhile, the Chinese Ambassador to Sri Lanka has undertaken a visit to Jaffna on Tuesday. Responding to a question from local media on President Dissanayake’s visit to India, Ambassador Qi Zhenhong said he saw Mr. Herath’s media remark about it. “We are very glad to see this development because India and Sri Lanka are close neighbours. When the two countries enhance their relationship and promote their economic cooperation, they can deliver benefits to two peoples,” he told reporters at the Jaffna Press Club. China, too, has invited Mr. Dissanayake to Beijing at his convenience, he said. The visit to China would enhance our traditional friendship and promote our bilateral economic cooperation, and bring more benefits to our peoples,” he noted.

A vendor displays newspapers for sale at a stall in Kandy on November 16, 2024. Sri Lankan President Anura Kumara Dissanayake’s leftist coalition won a majority in snap parliamentary polls, provisional results showed on November 15.
| Photo Credit: AFP

The staggering mandate — over a two-thirds majority — that Sri Lanka’s National People’s Power [NPP] coalition led by President Anura Kumara Dissanayake received in the November 14 general elections is a first in the country’s proportional representation system.

The unprecedented electoral feat, however, cannot be understood without appreciating the southern alliance’s political breakthrough in regions that are home to the island’s ethnic minorities. In almost all districts across Sri Lanka’s north, east, central and southern hill country, where Tamils, Muslims, and Malaiyaha Tamils live, the NPP has made impressive gains.

Editorial | A resounding victory: On the Sri Lankan election result

In the five electoral districts across the Northern and Eastern provinces, its candidates, all locals, secured 12 out of 28 seats. The NPP beat regional parties hands down in all districts but one, reflecting both the success of its outreach and the unmistakable shift within those electorates. That it did so in Jaffna and Vanni in particular, is historic for a southern political formation.

University of Jaffna academic Sengarapillai Arivalzahanattributes this largely to voters’ “anger and frustration” with long-time Tamil politicians. “Fifteen years after the war ended, Tamil people in the north and east have seen little relief or progress. There is a widely shared sentiment that the local parties and leaders were all talk and no action,” says the mathematician, who supported the NPP.

The prevalent disenchantment with their old leadership was one key reason, but it cannot entirely explain the shift. Tamils have been concerned that the fragmented Tamil nationalist polity, pre-occupied with internal disagreements, was weakening their voice in the national arena.

Further, through the post-war period, most Tamil parties focused mainly on war-time accountability and a political solution to the national question. Barring a few actors who took up local struggles over land grabs by the state, they rarely acknowledged or flagged the enormous financial strain facing most households.

Mounting household debt, joblessness, precarity surrounding rural livelihoods, and the abject absence of economic revival that stifled people’s daily lives in the war-affected region did not get their attention. In this context, President Dissanayake’s effective messaging recently appears to have connected with the ordinary Tamil voter.

Outdoing ITAK

Despite constraints, the formerly dominant Ilankai Tamil Arasu Katchi (ITAK) that ran alone — its former partners in the Tamil National Alliance contested through other formations — still managed to secure eight seats, points out party member Shanakiyan Rasamanickam, who was re-elected as Batticaloa MP. Apart from the three NPP candidates in Jaffna, former legislator and senior politician S. Shritharan retained his seat, while former MP and lawyer M.A. Sumanthiran, a spokesman of the party, lost his. Jaffna district also saw the re-election of All Ceylon Tamil Congress Leader Gajen Ponnambalam and the entry of an independent candidate.

“Our party [ITAK] had many challenges. Some diaspora groups were bankrolling few local forces and pushing a divisive agenda,” says Mr. Rasamanickam, who emerged the top candidate in Batticaloa. He is also credited with leading a focused campaign in the district, where the ITAK won three seats, while the NPP won just one. It is the only district where any other political party beat the NPP. Reflecting on the verdict, the 34-year-old says: “Going forward, it is clear that Tamil nationalist assertion without a focus on people’s economic and livelihood hardships will not help.”

Meanwhile, the NPP appears to have drawn more Muslim voters in the east, going by its victory in neighbouring Ampara and Trincomalee districts, where many in the community say they have lost faith in their local leadership. All the same, well-known Muslim leaders, Rauf Hakeem of the Sri Lanka Muslim Congress who contested from the central Kandy district, and Rishad Bathiudeenof the All Ceylon Makkal Congress, who ran from northern Mannar, that is part of the Vanni electorate district, retained their seats.

‘Workers as people’

The NPP’s performance in the hill country, too, is remarkable, especially in districts that were bastions of the Ceylon Workers’ Congress and its rival Tamil Progressive Alliance.

While the traditional parties saw estate workers as “just a vote bank”, the NPP approached them as “people”, says Krishnan Kalaichelvi, who won from Nuwara Eliya district. Her victory, along with that of NPP candidate Ambika Samuel in neighbouring Badulla district, marks Malaiyaha Tamil women’s entry in to the Sri Lankan parliament for the first time.

“We campaigned hard on the ground, listening to people’s issues over wages, land rights, children’s education. It was the youth who backed us first, they have been waiting for change. Over time, they spoke to their families on our behalf and our support base grew,” says the long-time political activist and daughter of an estate worker. “My father gave his labour to his country till the time of his death… there are scores of people like him. The old political leadership was interested in its own power, not the people,” she says, adding that the NPP “went directly to the people” rather than through “power brokers and middlemen”. In Ms. Kalaichelvi’s view, Mr. Dissanayake’s declaration at a meeting in Hatton town in 2023 that he would recognise our people as “Malaiyaha Tamils” rather than “estate Tamils” struck a chord with many.

It is now amply clear that ethnic minorities have willingly placed their trust in President Dissanayake, observes the Jaffna-based academic Mr. Arivalzahan. “The President and his government have a moral obligation to keep their promises now,” he adds.