State has formally terminated Sh637bn Adani deals — Mbadi

The government has formally terminated the Sh637 billion Adani deal days after President William Ruto ordered cancellation of the contract.

National Treasury CS John Mbadi on Thursday confirmed to Parliament that the government had disengaged from the deal that was to see the Indian conglomerate running both Jomo Kenyatta International Airport and Ketraco for 30 years.

Mbadi spoke when he appeared before the National Assembly’s Public Debt and Privatisation Committee chaired by Balambala MP Shurie Omar.

“This communication (cancellation of Adani deal) was from the highest level and he (President Ruto) said it in Parliament forming part of his submission, we should have comfort that at such high level there is no possibility of doing otherwise,” Mbadi told MPs.

Ruto cancelled the Adani Group takeover of the JKIA, where the Indian firm was to take over the airport’s expansion at a cost of Sh238 billion and manage the operations of the country’s largest airport for 30 years.

Adani Energy Solutions, a subsidiary registered in Kenya, had also signed another Sh95 billion deal with Ketraco to build electricity transmission lines.

The company was also to manage the transmission lines for 30 years.

According to Mbadi, a team of technocrats from Treasury, Energy ministry and the contracting agencies – JKIA and Ketraco – was formed to implement the President’s directive.

The team, Mbadi said, sat the following day (Friday) from 3.30pm to review the contract including the cost implications.

“Immediately the President spoke, a team was put in place consisting of persons from Privately Initiated Proposal, the line ministries and the contracting agencies,” Mbadi told the session chaired by Committee vice chairperson Makali Mulu (Kitui Central).

The sentiments come hours after the High Court ordered the state to produce evidence to substantiate claims that the Adani-JKIA deal has been cancelled.

This was following a court case lodged against the deal, which petitioners argued was signed in secrecy and without public involvement.

The CS also assured the lawmakers that taxpayers will not bear any cost as a result of the cancellation of the multi-billion deals.

There have been fears that the country could incur huge expenses due to the contract breach.

“Concerning JKIA, there is no deal to terminate because we were still in the negotiation process, nothing had been signed,” Mbadi said.

“A team had already been set up to undertake the cancellation process ( Ketraco), We are confident that there will be no cost as a result of the cancellation of that deal.”

The CS was responding to calls for assurance on whether there will be contract breach cost as a result of the development. “Is the country going to incur any expenses or cost as a result of the cancellation?”posed Mulu.