Bad news for Adani Power as Jharkhand rejects Rs 120-bn bid to set up SEZ

The decision was taken by the Board of Approval, the highest decision making body on special economic zone related matters

The commerce ministry has rejected Adani Power's proposal to set up a special economic zone for the power sector in Jharkhand entailing an investment of Rs 150.02 billion as it was inconsistent with the sectoral guidelines, an official said.

The decision was taken by the Board of Approval, the highest decision making body on special economic zone (SEZ) related matters, in its meeting on February 5.

The inter-ministerial board is headed by the commerce secretary.

"The board noted that the proposal was inconsistent with the power guidelines dated February 16, 2016 and also that there was no recommendation from the state government and after deliberation, (the board) decided not to approve the proposal," the official added.

The developer of the zone — Adani Power (Jharkhand) — had sought in-principle approval for setting up a sector specific SEZ at Godda district in Jharkhand over an area of 425 hectares.

A query sent to the company on the matter remained unanswered.

The developer had informed the ministry that it is in the process of acquiring the land through the state government.

The project, according to the company's application, would generate 199 direct and 15,000 indirect jobs.

According to industry sources, the company has acquired certain parcels of land to be used for peripheral infrastructure like roads and storage.

Adani Power (Jharkhand) is a step-down subsidiary of Adani Group firm Adani Power, which is mainly into power generation.