Court halts billionaire Adani’s proposal to invest in Kenya’s biggest airport

A Kenyan court has temporarily halted the government’s plan to grant India’s Adani Airport Holdings Ltd. a 30-year contract to operate the country’s main airport, pending a final ruling, Bloomberg reported.

The High Court issued an order preventing any action or implementation of the proposal by Adani until the case is resolved, according to Faith Odhiambo, president of the Law Society of Kenya, which applied.

The Law Society of Kenya and the Kenya Human Rights Commission, a non-governmental organization, are contesting the government’s decision to lease Nairobi’s Jomo Kenyatta International Airport to Adani Airport Holdings. They argue that the deal violates the constitution and are challenging the government’s authority to proceed with the lease.

“Leasing the strategic and profitable JKIA to a private entity is irrational” and contravenes the constitutional principles of “good governance, accountability, transparency, and prudent and responsible use of public money,” they said in their filings.

The Law Society of Kenya and the Kenya Human Rights Commission also contend that the $1.85 billion deal between the government and Adani Airport is “unaffordable” and could lead to job losses, disproportionate public fiscal risk, and little value for taxpayers.

According to their filings, they argue that Kenya can raise funds independently to expand Jomo Kenyatta International Airport without committing to a 30-year lease.

Under the terms of the build-operate agreement, Indian billionaire Gautam Adani’s company would be responsible for upgrading Jomo Kenyatta International Airport, East Africa’s busiest aviation hub. The deal includes constructing a second runway and a new passenger terminal.

The Kenyan government has defended the arrangement, arguing that the airport is currently operating beyond its capacity and urgently requires upgrades. In July, Kenya Airports Authority’s acting Managing Director, Henry Ogoye, emphasized that the proposal would undergo rigorous technical, financial, and legal reviews to ensure it aligns with the nation’s public-private partnership laws.

Henry Ogoye highlighted that the investment needed for the project is “significant and cannot be funded with the prevailing fiscal constraints without recourse to private funding.”

Adani Airport, controlled by Asia’s second-richest person, Gautam Adani, already manages a portfolio of eight airports in India, dominating over 50% of the top 10 domestic routes. The company’s airports handle 23% of Indian air traffic and serve 20% of the total passenger base.