YSRCP’s social-media has widely promoted the meeting of YS Jagan Mohan Reddy with Japan’s Consul General Kojiro Uchiyama. While the Japanese delegation has invited AM Jagan to visit Japan and to meet Japan’s investors who were keen to invest money, YCP activists and leaders claimed it as Jagan government’s achievement and the trust of foreign investors on Jagan.
But within just two weeks, Jagan got a major shocker from Japan. Japanese Ambassador has shot off a letter to Jagan asking him to roll back his decision over Power Purchase Agreements (PPAs). He asked Jagan to honour the signed contracts. Japan cautioned Jagan administration against its decision to reduce tariffs on signed PPAs as it will result in investors losing confidence.
Cautioning that this will not only harm the business environment of the state but also hinder its move to cleaner sources of energy, the Japanese Ambassador to India has requested the AP CM Jaganmohan Reddy, to honour the contracts. Moreover, the report noted that developer companies are funded by overseas sovereign and pension funds which will be hugely impacted by these reduced tariffs.
India’s two major renewable energy developers – ReNew Power and SB Energy- are thoroughly backed by Japanese investments. ReNew claims to be India’s largest independent power producer with a capacity of over 7 gigawatts (GW). And the SB Energy has business dominance in natural power combined with artificial intelligence and electric vehicles. These two firms have been backed by Japan’s investors who funded the two firms. So, any little impact on the business of these two companies would directly affect Japanese investors. Japan’s embassy and India’s Power Ministry have already sent letters to YS Jagan to reconsider his decision.
With pressure mounting on AP from Union Government and Japan, Jagan is caught off-guard. It is learnt that Jagan now wants to re-consider his decision – not completely though – but to find middle-ground to save the interests of foreign investors.
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