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• Inside Adani’s Controversial $1.84bn Proposal for …

• CS Nominee John Mbadi’s Plans for Treasury

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Inside Adani’s Controversial $1.84bn Proposal for JKIA

Adani Airport Holdings Limited (AAHL), an Indian based company, has proposed to invest US$ 1.84 billion in a bid to expand the Jomo Kenyatta International Airport (JKIA), the Kenya Airport Authority confirmed last week after the proposal leaked.  

• The proposal, a copy of which The Kenyan Wall Street has seen, is under a concession agreement seeking an expected 18 percent annual return on investment if the deal is accepted.

• The government would grant concession to Adani to finance, build and operate the project for 30 years, and give the company an equity stake in perpetuity.

• Adani proposes a US$ 750 million investment in developing a new terminal building, associated apron, taxiway system and two rapid exit taxiways seeking to improve efficiency.

It will also use US$ 92 million to improve the taxiway network system, establish two more rapid exits, 90-degree taxiway connections at both ends of the runway, remote aircraft parking stands and other associated facilities, by 2035. An extra $620 million will be used in developing new facilities to ensure a seamless integration with existing infrastructure.

“Procuring the proposed project using a competitive bidding method may impede achieving the desired outcomes within the set timelines due to the extended procurement process, coupled with contractual and delayed project commencement timelines associated with competitive bidding.” Adani said in the proposal dated March 2024.

“2nd staggered runway on southern side of the airport will be considered after utilizing the current runway efficiently,” the com

Why it Matters

The leaking of the proposal immediately public fears that it had already been secretly signed, which led to planned protests within the regional hub. Although the protests did not happen as expected, popping up instead in the Nairobi Central Business District (CBD), the leak helped fuel ongoing public discussions about government deals and accountability.

According to the Kenya Airports Authority, the proposal is still in its initial phases, and will be scrutinised before it is subjected to stakeholder engagement and further scrutiny by both Parliament and the Attorney General. “The attendant investment requirement is significant and cannot be funded with the prevailing fiscal constraints without recourse to private funding,” Henry Ogoye, the Acting Managing Director/CEO of KAA said in a statement.

Public scrutiny has also focused on Adani Airport Holdings, a subsidiary of Adani Group. The conglomerate was established in 1988 and has 16 companies, out of which 9 are listed, with investments spread across ports, food, real estate, infrastructure, sports, mining and energy. In 2023, Hindenburg, a New York based short seller research company, released a report detailing organized stock manipulation and accounting fraud from Adani group firms.

Stay updated on this and other stories on The Kenyan Wall Street.

CS Nominee John Mbadi’s Plans for Treasury

Last week, President William Ruto nominated opposition MP John Mbadi to replace Prof. Njuguna Ndungu as the Cabinet Secretary of National Treasury, at a time when the ministry has been under siege.

• The seasoned politician holds masters of business administration from the University of Nairobi and is currently serving as a nominated member of parliament.

• He served as Member of Parliament between 2008-2022, and once served as leader of minority. Between 2012-2013 he served as an assistant minister in the office of prime minister.

• Mbadi has also worked as senior accountant and full accountant at University of Nairobi between 1999-2005.

“I pledge to rebuild our economy, making it bigger & better through strategic infrastructure investments, innovation & fiscal discipline. By empowering SMEs and enhancing financial inclusion, we will create jobs and promote growth, ensuring a resilient & inclusive economy for all,” Mbadi said in a series of posts on X after his nomination, “We aim to create a dynamic and resilient economy that can sustain high growth rates, create jobs, and improve the quality of life for all Kenyans.”

The nominee listed his priority areas would include enhancing the ease of doing business, strategic investments in human capital, infrastructure, financial sector reform, innovation and technology, trade and investment, public-private partnerships, and governance and anti-corruption.

Missing from the list are his thoughts on how to handle public debt, which has triggered public discontent as repayments loom and the government borrows to meet repayment needs and fill budget deficits. Other questions that’ll likely shape his vetting include his plans on pending bills, the plans by the government on VAT refunds, and how Treasury would have done the Finance Bill 2024 any differently under his leadership.

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