Adani's First International Airport Venture Worth $1.85 Billion In Jeopardy After Kenyan Court Ruling

The Kenyan High Court has issued an injunction suspending a $1.85 billion deal between the Kenyan government and India’s Adani Airport Holdings Ltd.

The deal granted Adani the right to operate Nairobi’s Jomo Kenyatta International Airport (JKIA) for 30 years, but the suspension halts any further action until the court issues further rulings.

A legal challenge led by the Kenya Human Rights Commission and the Law Society of Kenya claims that leasing JKIA to Adani Airport is unconstitutional, citing violations of governance, transparency, and fiscal responsibility. According to the suit, JKIA is a strategic asset, and leasing it to a private entity is "irrational" and potentially harmful to the public.

Faith Odhiambo, president of the Law Society of Kenya, described the deal as “unaffordable” and warned of potential job losses. She also highlighted the fiscal risks involved, arguing that the Kenyan government could finance the airport’s expansion without resorting to a long-term lease to a foreign entity, reports Hindustan Times.

In response, the Kenyan government has defended the agreement. Citing capacity constraints at JKIA, officials argue that improvements are urgently needed, and private investment is the only viable option given current fiscal limitations.

Henry Ogoye, Acting Managing Director of the Kenya Airports Authority, stated that the deal would undergo rigorous financial and legal reviews to ensure compliance with public-private partnership regulations.

Adani Enterprises, led by billionaire Gautam Adani, had launched a new subsidiary, Airports Infrastructure, to manage JKIA as part of its international expansion.

Plans for a $750 million investment in a new terminal and taxiway by 2029, plus an additional $92 million for upgrades by 2035, would mark Adani's first airport venture outside India.

However, the proposed deal has faced significant opposition. The Kenya Aviation Workers Union, representing 10,000 members, had initially planned a strike due to concerns over potential job losses.

Despite the controversy, the Kenyan government continues to support the deal. Adani Enterprises is also preparing to list its airport business on stock exchanges by 2028, signalling its continued expansion in the global aviation market.