In a landmark move, Kenyan President William Ruto has announced the termination of two major contracts with India's Adani Group, consisting an early $2 billion project to develop country at leading air field and $736 million energy generation project.
The announcement was greeted with loud applause by Kenyan Parliament members who have been annually raising eyebrows over the transparency and would-be return on investment from such projects.
Billionaire Gautam Adani's group has not immediately commented on the cancellation. U.S. investigators recently alleged that Adani and seven others were involved in paying $265 million in bribes to Indian government officials The Adani group firmly denied the allegations, and threatened to take legal action in all possible cases.
As for the Kenyan airport, the proposal was submitted by the Adani Group in March and came to light through a social media leak in July. The project was temporarily suspended in September with a Kenyan court ruling that it may not deliver value for taxpayers.
Yet in the face of growing scrutiny, President Ruto and other top government officials have previously defended the deals - even after Hindenburg Research released a detailed report in 2023 questioning many aspects of the Adani Group's business activities. However, there was no corruption in the power generation agreement, Energy Minister Opio Wandai insisted on Thursday.
Experts, including George Kamau who specializes in Kenyan procurement law, expect that the Adani Group will pursue arbitration as a response to the cancellation. On his part, Kamau said the case is likely to benefit the Kenyan government because of some of the concerns over integrity that were cited in the ruling.
The move raises questions on what this means for investments coming to Kenya, and also for its relations with the outside world as this news develops.