Colombo: The Adani Group has withdrawn from its $1 billion, 484 MW wind power project in northern Sri Lanka after the newly-elected government moved to renegotiate its terms. Adani Green Energy Ltd informed Sri Lanka's Board of Investment on Wednesday about its decision, citing the formation of fresh committees to review the project proposal.

The wind project, situated in Mannar and Pooneryn, aimed to develop wind generation capacity under the build-own-operate model and included a 20-year power purchase agreement (PPA). However, the initiative has been under scrutiny since Sri Lankan President Anura Kumara Dissanayake assumed office in September, pledging to cancel what he referred to as “corrupt” projects during his campaign.

Adani Green's letter to the Board of Investment stated, “While we respect the sovereign rights of Sri Lanka and its choices, we would respectfully withdraw from the said project.” Despite spending $5 million on pre-development activities, including land acquisition and environmental clearances, the Adani Group opted to exit.

The project also drew criticism for its potential ecological impact on a nearby bird corridor and disruption to local fishing communities. While the project promised renewable energy and substantial foreign investment, opposition from environmentalists and local stakeholders added to its challenges.

Adani reaffirmed its willingness to collaborate with the Sri Lankan government in the future. The company remains involved in developing a terminal at Colombo port, a joint venture with the Sri Lanka Ports Authority and John Keells Holdings.

This development follows recent controversies surrounding the Adani Group, including bribery allegations in the U.S. related to solar power purchase agreements, raising further questions about its global operations.