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The related infrastructure that would transmit electricity to consumption centres will see further investment of over $290 million, two sources with knowledge of the matter said.

Adani Group plans to invest over $1 billion in setting up projects in Sri Lanka to generate electricity from wind in what would be the island nation’s single largest foreign direct investment and the biggest ever power project, sources said.

Group firm Adani Green Energy Ltd (AGEL) will set up two wind farms in Sri Lanka’s Mannar town and Pooneryn village in the northern provide with a total installed capacity of 484 megawatt at an investment of about $740 million.

The related infrastructure that would transmit electricity to consumption centres will see further investment of over $290 million, two sources with knowledge of the matter said.

The projects will not just be Sri Lanka’s largest renewable energy project but also the nation’s biggest power project to date.

Last month, Sri Lanka had entered into an agreement to buy electricity from Adani’s wind power stations for 20 years.

AGEL will be paid 8.26 cents per kilowatt-hours (kWh) as per the agreement. This is lower than up to 26.99 cents per kWh paid to thermal projects of state-owned CEB and 9.67 to 13.99 cents per kWh for wind projects. It is lower than 8.75 cents per kWh paid for Odamawadi solar project.

Adani Group is also involved in building a $700 million terminal project at the island nation’s largest port in Colombo.

Sri Lanka, which suffered from crippling power blackouts and fuel shortages during an economic crisis in 2022, has enacted a new legislation to revamp the country’s power sector and attract investment in renewable energy.

The move, which is in line with the commitments made under a $2.9 billion aid from the International Monetary Fund (IMF), seeks to reduce losses in the state-run power company Ceylon Electricity Board (CEB) and make the sector more appealing to investors.

Adani’s project is also strategically important as it would restrict China’s economic influence in the Indian Ocean, particularly Sri Laka’s northern region, which is very close to India’s southern mainland.