The fate of Indian conglomerate Adani Group's Sh104 billion deal with the Ministry of Health remains unclear after President William Ruto on Thursday ordered the ministries of Transport and Energy to cancel the ongoing contracts for the country's infrastructure in the energy and aviation sectors.
During the State of the Nation Address, the Head of State said the decision to cancel the deals in the two ministries was based on credible evidence of corruption by the relevant authorities.
“I have stated in the past, and I reiterate today, that in the face of undisputed evidence or credible information on corruption, I will not hesitate to take decisive action,” President Ruto said.
“Accordingly, I now direct - in furtherance of the principles enshrined in Article 10 of the Constitution on transparency and accountability, and based on new information provided by our investigative agencies and partner nations - that the procuring agencies within the Ministry of Transport and the Ministry of Energy and Petroleum immediately cancel the ongoing procurement process for the JKIA Expansion Public Private Partnership transaction, as well as the recently concluded KETRACO transmission line Public Private Partnership contract, and immediately commence the process of onboarding alternative partners,” the President said.
There have been concerns that Apeiro Limited, the largest shareholder in the Safaricom consortium that has been awarded the contract for the technology-based system for the Universal Health Coverage (UHC), has business links to the Adani Group.
The government awarded the consortium a contract to provide an Integrated Healthcare Technology System (IHTS) for the UHC programme.
Each of the three firms will contribute to the Sh104.8 billion needed to implement, maintain and support the IHTS system over the next ten years based on their shareholding.
The Abu Dhabi firm owns 59.55 per cent of the stake in the consortium, Safaricom has a 22.56 per cent stake, while Konvergenz Network Solutions Limited has a shareholding of 17.89 per cent.
The firms will recoup their investment through monthly instalments that will be paid starting February next year, upon hitting the set performance milestones.
Apeiro is a subsidiary of Abu Dhabi-based investment firm, Sirius International Holding while Sirius itself is a subsidiary of International Holding Limited (IHL), creating a web of companies that make it hard to track the beneficial owners.
Sirius is currently in a joint venture with Adani in which they run a company known as Sirius Digitech Limited.
On Thursday, some leaders raised concerns about why President Ruto did not mention the Adani links with the Health Ministry docket.
Seme MP Dr James Nyikal, a member of the health committee in the National Assembly, said that whereas the cancellation was the best thing to do, he was concerned that the Head of State remained silent on the deal with respect to the Health Ministry.
“Adani cancellation is the best thing. I think we should have acted much earlier than this because we had information about this company so it ought to have happened earlier.
“But we are concerned with Adani in the healthcare. We don’t know what that means because he has not come out clear on that. As somebody who sits on the health committee, this is something that is of great concern to us and we will have to push and find out if really they are going to cancel Adani from other contracts, we must also look at the one in health,” Dr Nyikal said.
But a State House official told Nation the deal remains as there is no Adani in SHA-Safaricom deal. “The company is independent,” the official said.
Politician Jimi Wanjigi, a critic of the Ruto administration said president Ruto must come out clear on the Adani deal with respect to the Social Health Authority plan.
“Adani is SHA and SHIF! This must also be cancelled henceforth! Adani will soon be bankrupted by this indictment,” Mr Wanjigi told Nation .
Speaking in Nakuru during the recent ground-breaking ceremony of the 35-megawatt Orpower 22 Power Plant at the Menengai Geothermal site, Dr Ruto lauded the Adani Group’s investment in the project.
“The Adani Group is investing Sh 95 billion of its own money in the transmission line. Had we borrowed that money, it would have burdened the people of Kenya. This is now a private-sector investment, similar to the Naiorbi Expressway,” the President said before reneging on Thursday.
The Kenya Electricity Transmission Company Limited (Ketraco) signed the project agreement with Adani Energy Solutions Limited last month.
“I am pleased to announce the successful signing of the Project Agreement between the Kenya Electricity Transmission Company Limited (Ketraco) and Adani Energy Solutions Limited (the Project Company). The agreement marks the beginning of a transformative initiative to develop, finance, construct, operate, and maintain key transmission lines and substations across Kenya,” Energy and Petroleum CS Opiyo Wandayi announced shortly after inking the deal early last month.
