Finance South-east Asia India Adani Ports
Adani to scrap its massive port development in Myanmar
Oct 28, 2021
Coup leader Senior General Min Aung Hlaing visits Adani's Mundra port in July 2019.

'The company’s risk management committee, after a review of the situation, has decided to work on a plan on exiting company’s investment in Myanmar, including exploring any divestment opportunities,' Adani Ports informed the stock exchanges on 27 October 2021.

While Adani had foreshadowed in May 2021 that it might abandon its Myanmar port investment, the actual announcement came as a bombshell.

Numerous news outlets reported on Adani's decision, which means the scrapping of a US $290-million new port development on the Yangon River in Myanmar's biggest city. The reports said the decision could result in the writing down of US $127 million.

For over two years, human-rights advocates have slammed Adani's business arrangements with the Myanmar Economic Corporation (MEC), a company owned by the Myanmar military. In 2019, the criticism focussed on the atrocities carried out by the military against the Rohingya people and subsequent damming reports by a UN fact-finding mission.

Rohingya refugees flee the carnage and atrocities wrought by the Myanmar military in 2019.

Matters came to a head in February 2021 after the military overthrew the Myanmar government and instigated a bloody crackdown on civilian protests. Human-rights groups are reported to have estimated the number of civilian casualties at over 1000.

Links between Adani's flagship company, Adani Ports and Special Economic Zone ('Adani Ports'), and the coup leader, Senior General Min Aung Hlaing, became an international embarrassment to the Adani Group.

Images of the general being feted by Adani Ports during his visit to Mundra in 2019 became a thing of notoriety. In March 2021, a report by two human-rights groups said that Adani Ports had paid $30 million in land-lease fees to the MEC.

Myanmar's coup leader visits Adani facilities in India, 2019.

The USA applied sanctions to Myanmar, the MEC and the general. In April 2021, the Adani Ports company was struck off the Dow Jones Sustainability Index. In May, Adani Ports said it could quit its Myanmar development as a result of sanctions.

 

 

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News reports covering Adani's latest announcement say that the company's exit from its Myanmar port development will be completed between March and June 2022.

A media release by some of the organisations that collaborated on the Myanmar component of the campaign directed at Adani is as follows:

Australian and Myanmar groups welcome Adani Ports’ withdrawal from Myanmar and renew calls to shelve Carmichael coal project

The Australian Centre for International Justice, Justice For Myanmar and Stop Adani cautiously welcome Adani Ports’ plans to divest from their Myanmar container port business, which is a testament to grassroots campaigns for corporate accountability in Myanmar and Australia, and the work of the UN Independent International Fact-Finding Mission on Myanmar (FFM). 

The groups say Adani Ports’ decision to withdraw from the project shows that the Adani Group can walk away from projects that are breaching human rights and have renewed calls for Adani to shelve its controversial Carmichael coal mine in Australia that is opposed by Traditional Owners, the Wangan and Jagalingou people. Traditional Owners have this week called for urgent intervention from the Queensland government to protect a significant cultural site that Adani is preparing to clear for its coal mine. Earlier this month Queensland Police refused Adani’s requests to remove Traditional Owners occupying Adani’s Carmichael mine site and acknowledged their cultural rights under the Queensland Human Rights Act. 

The port project is a partnership with Myanmar military conglomerate Myanmar Economic Corporation (MEC) under a build-operate-transfer deal, which made Adani Ports complicit in ongoing atrocities. Adani Ports’ deal with MEC came after the Myanmar military’s 2017 campaign of genocide against the Rohingya and was identified by the FFM in their report on the Myanmar’s military’s economic interests, which called for all businesses to cut ties with the Myanmar military and its conglomerates.

Google image of the site of Adani's Yangon River port development.

In March 2021, ACIJ and JFM published Port of Complicity, a report into Adani Ports’ business in Myanmar that included new evidence of payments to the MEC and the company’s direct relationship with Senior General Min Aung Hlaing, increasing pressure on investors. Adani Ports’ initial response was to deny the stark evidence of its business relationship with MEC.

In June, Adani Ports disclosed that they had paid US$90 million to MEC.

In August, ACIJ and JFM wrote to the US Treasury urging them to reject a request from Adani Ports for a general licence to exempt them from US sanctions on MEC.

Adani Ports’ business dealings in Myanmar and Australia have severely damaged the company’s reputation. In April, Adani Ports was removed from the Dow Jones Sustainability Index after human rights and environmental groups submitted a case for review due to Adani Ports’ links to the Myanmar port project and the Adani Carmichael coal project in Australia. Adani Ports set up the Bowen Rail Company who will soon begin hauling coal from Adani’s mine to Adani’s coal port on the Great Barrier Reef, the North Queensland Export Terminal, which is operated by Adani Ports. Investors continue to exclude the company citing environmental and human rights concerns. 

Adani’s decision to divest comes amid increasing troop reinforcements and attacks against people in Sagaing and Magway Regions and Chin State in north-western Myanmar and as the UN reports fears of a spike in atrocities. As the military increases their campaign of terror, businesses and their investors must ensure that they are not complicit in financing the Myanmar military’s grave crimes.

Justice For Myanmar spokesperson Yadanar Maung says: 

“Adani Ports’ plan to divest shows community and investor pressure works. Business with the terrorist Myanmar military does not pay. Adani Ports should never have gone into business with MEC, knowing they would be complicit in the Myanmar military’s atrocities. Adani Ports must now find a way to exit responsibly by mitigating the impact on their Myanmar workers and recovering what they can of their $90 million payment to MEC so they do not leave a windfall for the terrorist Myanmar military. Contractors on the port, including ITD Cementation India and Singapore firms HSL Constructor Pte Ltd and Asia Infrastructure Ptd Ltd must also ensure they cut all ties with the Myanmar military. Continuing work to develop the port creates an asset that the Myanmar military will use to further finance their campaign of terror. 

While we recognise that Adani Ports has finally made the right call in Myanmar, Adani Group continues to do harm to the climate and communities elsewhere. We stand in solidarity with First Nations people, the Wangan & Jagalingou and all Australians in opposing Adani’s destructive Carmichael mine project.”

Rawan Arraf, Executive Director at the Australian Centre for International Justice said:

“We welcome the decision by Adani Ports to disengage from their deeply flawed investment in Myanmar. It was untenable for Adani Ports to maintain business with a sanctioned entity and after sustained pressure from the public and investors. It is a testament to the coordinated work of activists in Myanmar who were joined by campaigners in Australia and abroad to expose its dealings in Myanmar. For years, Adani Ports ignored the clear and direct public warnings before and after it entered into business in Myanmar. 

It is positive that Adani Ports has shown an apparent willingness to engage in human rights due diligence obligations by divesting from Myanmar. However, there are massive failings connected to the Adani Group’s operations in India and Carmichael that it must reconcile. The impacts on the human rights of the Traditional Owners, the Wangan & Jagalingou are severe, they face destruction of their sacred places and cultural heritage. Adani Group companies must respect the rights of the Wangan & Jagalingou people and shelve its destructive Carmichael coal mine.”

Pablo Brait, Campaigner, Market Forces said:

“Adani finally announcing that it will walk away from its business with the Myanmar military shows that with enough pressure it can be convinced to do the right thing. The next project it needs to walk away from is the climate-wrecking Carmichael thermal coal mine. Building a new coal mine at a time when coal use needs to be urgently phased out sabotages efforts to limit global warming.”

An infographic that formed part of the 'Port of Complicity' report.