A report in Economic Times has revealed that Japanese ambassador to India Kenji Hiramatsu wrote to Chief Minister YS Jagan Mohan Reddy against the state’s efforts to cut renewable energy tariffs by reviewing signed-and-sealed contracts. Such a move has unnerved foreign investors and damaged the business environment, the letter says.
Many of these renewable energy companies are funded by overseas sovereign and pension funds. “Many foreign investors, including Japanese companies, are now watching closely the situation unfolding in your state regarding the renewable energy sector,” the Ambassador mentions in the letter.
SB Energy and ReNew Power are two of the biggest renewable energy developers in India and they have sizeable Japanese investments. Both the companies have PPAs signed with Andhra Pradesh Government and they are being reviewed by the new government.
“Our concern as the Japanese government is that if legally binding contracts are not honored, it would cause significant impairment to the business environment of AP state,” they opine. The Japanese Ambassador has asked the Chief Minister to reconsider his decision in the letter. This is a Prime Example of how Jagan Reddy’s Government is going to hurt the foreign investments into India.
