Adani power plant and coal plans threatened by land owner court action
By Stephen Long
Cranes and a giant steel skeleton stand behind the home of Chinta Mani Shah, a retired schoolteacher from Motia village outside of Godda in the state of Jharkhand, north-eastern India.
“My intent was to build an ashram here,” he says.
“My vision was to be of some benefit to the local farmers by combining the best of modern and scientific ways of farming.
“Then the Adani company came,” he adds, gesturing to the structure being built behind him.
“Since that day I have lost all peace of mind.”
The structure arising behind his land is a thermal coal-fired power plant owned by Adani Power Limited, which has a contract to supply electricity to neighbouring Bangladesh.
It is more than 8,000 kilometres from Godda to the Galilee Basin in Queensland.
Yet the two districts are entwined: coal from Adani’s Carmichael mine, currently being built in Australia’s last untapped coal region, is expected to supply fuel for the power plant at Godda.
That’s if the plant goes ahead. It’s at the centre of a major land rights battle.
Mr Shah is among a group of local villagers who spoke to a local filmmaker, who shared the interviews and vision with the ABC.
Mr Shah is also one of the parties in a legal challenge before the High Court of Jharkhand.
Allegations of ‘coercion, fraud and undue influence’
The case filed with the court accuses Adani and its agents of using “coercion, fraud [and] undue influence” to illegally exclude thousands of people affected by the development from a required social impact assessment.
The claimants allege that a key meeting was full of labourers “from far away” who were paid to attend a crucial public hearing about the development and — in conjunction with local police — used brutal force to keep villagers opposed to Adani’s project out.Stop Adani movement ‘infiltrated’A mysterious environmental group fronted by dubious online identities has spent more than a year trying to forge ties with the Adani protest movement.Read more
“Thousands of people gathered to go into the venue site but they were prevented both by the police, who were acting as agents of private company Adani Power Limited, as well as by their security guards,” the writ filed with the court alleges.
“The situation was so bad that the police lathi [baton] charged the affected families. When they tried to attend the public hearing were beaten mercilessly.”
Adani flatly rejects these allegations.
“Adani Power Jharkhand Limited (APJL) has always upheld and respected the local traditions, customs and religious sentiments of the local people since the inception of its work at Godda more than four years ago,” a company spokesperson responded in a written statement.
“It neither supports nor has been involved in any act of aggression against any of these stakeholders.”
In a highly unusual move, Adani posted this statement on Twitter in answer to the ABC’s questions at roughly the same time as it sent it to the ABC, well ahead of publication.
Residents challenge land acquisition
The court case also challenges the forced takeover of land for the development by the State Government on behalf of Adani.
Under Indian law, a government can only acquire land for a private company if the project is for “public purpose”.
The claimants argue the project does not meet the definition of “public purpose” under the law.
Part of their argument is that the power plant will have few local benefits, since the electricity will all be exported and the coal used to generate the power will all be imported — largely from Australia.
“It is crystal clear from the various documents of Adani Power Limited that the power which shall be generated from this private project shall be exported to Bangladesh [while] the coal shall be imported from Australia … to Dharma Port and transported to the project covering a distance of around 700km causing immense pollution in transportation.
“Thus, there is not even a semblance of public interest.”
The state of Jharkhand denies all the allegations being put by the claimants and is contesting the court action.
Adani also rejects the claimants’ assessment, saying it has arrangements to provide some of the plant’s power to Jharkhand state.
“As per the Prime Ministers’ [sic] Memorandum of Understanding (MOU) the net 1,496 MW of the total energy produced at Godda (1,600 MW) will be given to Bangladesh Power Development Board (BPDB), Bangladesh,” it notes in its statement.
“However, as per the MOU signed with the Government of Jharkhand, up to 25 per cent of the energy produced i.e. up to 400 MW, will be offered to Jharkhand at a rate to be decided by the Electricity Regulatory Commission of Jharkhand from other sources, or also from operational plants of the Adani Group, if available.”‘Collapse waiting to happen’A leading accounting academic warns that Adani’s Australian subsidiary responsible for the Carmichael coal mine is in a “perilous financial position”.Read more
The irony is that Jharkhand is a resource-rich state, accounting for more than 40 per cent of the mineral resources of India, and the Adani power project is situated amid some of the richest coal deposits in the nation.
Adani’s own Jitpur coal mine is just kilometres away from the project site; when the plant was first proposed five years ago, this was to be the source of the coal.
But those plans rapidly changed, apparently because under Indian law domestic coal cannot be used for thermal power projects that will export electricity to another country.
So, Adani now appears set to transport imported coal vast distances, at extraordinary expense, into a state that is home to the biggest coal reserves in India.
Energy supply to Bangladesh is ‘costs plus, plus, plus’
Adani and its supporters argue that the project has a noble, humanitarian purpose because it will be supplying electricity to Bangladesh, one of the world’s poorest nations, thus enriching the lives of its citizens.
That proposition is utterly rejected by critics who argue the electricity will be expensive — far higher than Bangladesh would pay if it simply purchased electricity from India on the open market.
“The contract is costs plus, plus, plus,” says Tim Buckley, the head of energy research at the Institute for Energy Economics and Financial Analysis, a think tank that supports a transition to clean energy.
“Adani is able to pass through the costs of expensive coal from Australia, infrastructure and transport to the price.
“It will be delivering power at about double the normal price and triple the current price that they [Bangladesh] could have bought it for wholesale on the Indian power market.”
Transport costs would add about $40 to the landed cost of coal from the Carmichael mine in Godda, according to Mr Buckley, a former head of equities research at Citigroup who spent more than 30 years as an investment analyst in the banking industry.
A point of comparison is Adani’s power plant at Mundra in the company’s home state of Gujarat.
According to analysts at the Indian investment bank IDFC, the imported coal used to power that plant cost a little more than 3 rupees per kilowatt-hour in 2018.
Yet, according to Indian analysts, the average total price of electricity from thermal coal power plants operated by the state-owned National Thermal Power Corporation (NTPC) in India was about the same — just over 3 rupees per kilowatts hour.
That is, the cost of the imported coal alone was roughly equivalent to the total cost of electricity produced by power plants using local “mine-mouth” coal.Adani’s tax haven tiesPreviously unknown tax haven ties for Adani Group’s Australian operations are uncovered by Four Corners.Read more
When questioned by the ABC about pricing, Adani responded:
“The tariff from the Adani Power Jharkhand Limited India (APJL) power station at Godda includes the cost of transmission and will be much lower than the prevailing electricity tariff in Bangladesh.”
The company did not answer what it would be relative to prevailing Indian prices.
Mr Buckley argues the cost-plus electricity contract, signed with the state-owned Bangladesh Power Development Board, is clearly designed to benefit Adani and is, at least in part, an attempt to prop up Adani Enterprises’ Carmichael coal project in Australia.
“Why Bangladesh would agree to such a lop-sided contract is the $2 billion question,” Mr Buckley tells the ABC.
‘Land is indispensable to a Santhal’
The patriarch of the Adani business empire, Gautam Adani, is one of the richest men in India, while many of the villagers affected by the Godda power project are from the other end of the wealth spectrum.
Some are from the lowest castes in the Hindu religion and others are from an Indigenous tribal group known as the Santhal.
Archaeologists estimate that the Santhal have been in eastern India for up to 65,000 years. Like Aboriginal Australians, they have an ancient and spiritual connection to the land that has long been recognised in legislation.
“Land is indispensable to a Santhal,” a local villager explained to the independent Indian filmmaker who shared her interviews with the ABC.
“It is an intrinsic part of culture. The Santhal tribe and their land are like two sides of one coin. If land exists, Santhal exists, but if the land is taken away it just means they will be totally wiped out.”
The Santhal have a practice of burying their dead in the fields they sow, which become sacred to them.
One of them says: “We belong here, this is our ancestral land. We are buried on our land. We have no problem dying on our land but we will not give it away.”
Santhal land rights have previously been protected under a long-standing law which prohibited industrial development on their farming lands, but the laws have recently been watered down.
Adani says local landholders have been adequately compensated by the State Government, which has undertaken the land acquisition.
“There has been no direct acquisition of land by APJL,” it responded.
“Land for the project has been acquired by the Government of Jharkhand, in line with the rules of land acquisition under the LARR Act 2013.
“Throughout this process, Jharkhand Land acquisition Rules have been followed in letter and spirit.
“The Government has finalised compensation arrangements for the people impacted and APJL has duly deposited the same as per demand to Government. Compensation of this scale has not previously been given to any Raiyat in Jharkhand to date.”
While there is widespread opposition among the Santhal, opinion is divided in villages in the path of the Godda project.
Some, particularly absentee landholders who live in the cities, have been happy to cede property for compensation. In an impoverished region, others hope the project will bring economic gains.
Meanwhile, those fighting the project face a race against time; the High Court case, and a separate environmental challenge before India’s National Green Tribunal — scheduled for hearings in early August — will be of no consequence if construction reaches a point where the development becomes a fait accompli.
Curiously, geopolitics is working in favour of the project’s opponents.
Adani has contracts with a Chinese firm for equipment purchases and engineering work on the power plant.
With a border conflict taking India and China close to war, Adani is facing political pressure to terminate the deal, which could further delay or even jeopardise the project.