Mbadi: JKIA-Adani deal legally terminated with no financial impact

Treasury Cabinet Secretary John Mbadi has revealed that the controversial Jomo Kenyatta International Airport (JKIA) deal with India's Adani Group has been legally terminated.

Appearing before the Public Debt and Privatisation Committee on Thursday, Mbadi assured lawmakers that the cancellation has been executed in full compliance with legal procedures and will not result in any financial losses to taxpayers.

Mbadi disclosed that a senior team, comprising officials from the National Treasury’s Public-Private Partnerships (PPP) directorate, the Ministry of Energy, Kenya Electricity Transmission Company Limited (Ketraco), and JKIA, convened on Friday, November 22, at 3:30 p.m. to finalise the legal documentation for the deal's termination.

"This decision followed a directive from the highest level of authority, that is, the President, who announced it during his State of the Nation address in Parliament. There is no going back on this matter," Mbadi said, reiterating President William Ruto's pronouncement.

The Adani Group deal, which included the renovation and management of JKIA at a cost of Sh238 billion, was terminated a week after international corruption allegations surfaced against the conglomerate.

Adani Group founder Gautam Adani and several associates were accused of paying Sh34.3 billion in bribes to secure contracts.

Mbadi assured MPs that the project was in its initial stages and had not yet incurred financial commitments.

"The JKIA case did not progress to a point where taxpayers’ money was spent. Members should rest assured that no public funds have been or will be lost," he said.

The cancellation also affected another Adani Group contract with Ketraco valued at Sh96 billion. The deal included the construction of a 206km power transmission line to enhance the electricity supply around Nairobi and a 70km geothermal evacuation line linked to the Menengai complex. Both projects were initially scheduled for completion by 2028.

Nominated MP Suleka Harun raised concerns about potential financial repercussions, urging Mbadi to confirm that the termination would not lead to claims against the government.

"Now that you are here, CS, can you confirm to Kenyans that no money will be lost due to this cancellation?" she posed.

Mbadi reiterated that the government had taken every precaution to avoid any financial liabilities. "From where I sit, there is no financial loss to the taxpayers. I can confidently give you that assurance," he said.

Kitui Central MP Makali Mulu, who chaired the session, emphasised that any officials found responsible for payments resulting from the cancellation would be held accountable.

"We expect no taxpayer money to be lost, but if any payment has been made, those responsible will face consequences," he said.

The termination of the JKIA deal has been further scrutinised after a High Court ordered the government to provide evidence confirming its cancellation.

The inquiry follows a history of costly penalties from previous contract breaches, such as the Sh5.6 billion demanded by Chinese contractors after the botched JKIA Greenfield terminal project.

However, Mbadi has reassured the public that the Adani cancellation will not lead to similar financial consequences.