Treasury Cabinet Secretary John Mbadi has said the government will not compensate Adani Group following President William Ruto’s decision to cancel the deal.
Speaking outside parliament buildings after Ruto's State of the Nation address on Thursday, November 21, CS Mbadi assured Kenyans that the government would not compensate the Indian conglomerate because the deal was a Privately Initiated Partnership (PIP).
According to the finance minister, the decision by President Ruto to end the multi-billion deal was not a mutual termination to warrant the company a compensation.
However, CS Mbadi clarified that the government would only refund Adani Company the amount it spent during the initial stages of the agreement.
Unlike other methods of procurement, CS Mbadi noted that the PIP format was not competitive but rather flexible, allowing the parties involved to cancel the talks at any stage before the formal agreement.
“I don't see the possibility of losing any money, compensating them for doing what? The only thing is the amount they paid which will be refunded because it is not a mutual termination,” CS Mbadi assured Kenyans.
"In PIP there are not many expenses involved, so what would you compensate them for? I do not see any problem, PIP is the most flexible method of procurement," he added.
He further revealed that the deal was cancelled while in the initial stages of the agreement because the government had to conduct due diligence first before commencing with further talks.
On Thursday noon, President Ruto cancelled plans to award Adani Group a concessional deal to revamp the Jomo Kenyatta International Airport (JKIA) and construct the country's power lines.
Speaking during a State of the Nation address in parliament, the Head of State directed Transport Cabinet Secretary Davis Chirchir and his Energy counterpart Opiyo Wandayi to end the deals.
According to President Ruto, his decision was influenced by the evidence and credible information on corruption involving the multilateral company provided by the country's investigative agencies and partner nations.
"I now direct procuring agencies within the Ministry of Transport and the Ministry of Energy and Petroleum to immediately cancel the ongoing procurement process for the JKIA Expansion Public Private Partnership transaction, as well as the recently concluded KETRACO transmission line deals," Ruto directed.
