When a state-owned electricity board failed to make headway on a large new coal-fired power plant in central India, the government decided that Adani should bring the project to completion. Since 2010, the company has acquired the land and carried out preparatory works. However, the treatment of local people affected by the project has led to accusations of bullying and crony capitalism. At the height of protests against the proposed power station and an associated dam in 2011 and 2015, some of the leaders of the protest movement were bashed by assailants described as 'company goons'. In this story, Soumik Dutta describes the controversies associated with Adani’s Pench power project in the Indian state of Madhya Pradesh.

Genesis of the project

Back in 1987, the Madhya Pradesh Electricity Board (MPEB) acquired land from local farmers to build a coal-fired power plant at Chhindwara.  It promised to complete the project in three years and to provide government jobs and subsidised power to affected families. After 23 years, the MPEB failed to build the power plant, nor did the government take possession of the acquired land, which continued to be tilled by farmers. Thus, no jobs or subsidised electricity were provided, only compensation for loss of land. The level of compensation is in dispute, with farmer advocates saying most recipients received a paltry of Rs1500 to Rs10,000 (AUD $200) per acre paid by government while Adani has claimed that they received up to Rs100,000 (AUD $2000) per acre.

A questionnaire seeking clarity on the vexed issue of compensation, sent to the District Collector of Chhindwara, Mr Saurabh Kumar Suman, at his official email and repeated phone calls to his office went unanswered.

Adani’s entry

In 2010, the Madhya Pradesh government decided to bring in a private developer to kick-start the languishing project. The acquired land was sold to the Adani group at a whopping Rs13.50 lakhs ($24,000) per acre, without any fresh public hearings. The government of Madhya Pradesh had profited enormously at the expense of the farmers from whom it had acquired the land at much cheaper rates.

‘This process defies a Supreme Court of India’s ruling which states that land acquired for a public purpose cannot be sold to private entities by any government for making profit’, said Aradhana Bhargav, an advocate and the vice president of Kisan Sangharsha Samiti (KSS), Chhindwara, the community group spearheading opposition to the project.

Bhargav said the District Magistrate Saurabh Kumar had verbally admitted the above figure at the time she and a colleague had met him at his office, to submit a memorandum after they were discharged from hospital following the brutal attack on them in 2015 (see below). She said that there are no documents available in the public domain pertaining to the transaction. Even Right-to-Information queries were not answered, Bhargav added.

The proposed project has affected about three thousand farmers from twelve adjoining villages who have lost their land. A major river-diversion project associated with the power scheme has affected another 31 villages, with six of them having been fully submerged by the dam, completed in 2016.

The KSS says that Adani has built a wall around the project site, along with some site offices, but that little other work associated with the Pench power station has been completed. This lack of substantive project activity is corroborated by a report by the Global Energy Monitor,stating that, as of June 2019, no signs of serious construction activity could be seen at the project site.

Adani has established a subsidiary, Pench Thermal Energy (MP) Limited (formerly Adani Pench Power Limited), to establish its proposed power station near Chhindwara. The power station will consist of two 660-MW units, using ‘super critical technology’.

In May 2020, as India was reeling under lockdown due to the COVID-19 pandemic, the company signed a 25-year power-purchase agreement with Madhya Pradesh Power Management Company (MPPMCL) for procurement of electricity from the power station. It was reported that the agreement sets a price of Rs 4.79/unit (Rs 2.90/unit as fixed charge and Rs 1.89/unit variable charge) and that the coal is to be sourced from India’s western coalfields. Earlier reports said that the coal would be imported.