In a major set back to Adani conglomerate Norwegian pension fund KLP is divesting from Adani Ports and Special Economic Zone Limited on the grounds the company’s links with the Myanmar military breach the fund’s responsible investment policy, KLP told Reuters on Tuesday.
“Adani’s operations in Myanmar and its business partnership with that country’s armed forces constitutes an unacceptable risk of contributing to the violation of KLP’s guidelines for responsible investment,” KLP said in a statement to Reuters.
A spokesperson for the Myanmar military did not answer calls from Reuters seeking comment.
KLP, Norway’s largest pension fund, had an investment worth $1.05 million in Adani Ports at the time of its decision, it told Reuters.
It was divesting because the container terminal is being built on land owned by the Myanmar military and that there is an “imminent danger” the armed forces could use the port to import weapons and equipment, or as a naval base.
“In this way, the port could be used by the army to continue its violations of human rights,” KLP said.
Adani Ports was not immediately available for comment.
Adani Ports, India’s largest port operator, has been under scrutiny from international investors over its project to build a container terminal in the city of Yangon on land leased from a Myanmar military-owned conglomerate.
A military coup in Myanmar on Feb. 1 and an ensuing crackdown on mass protests in which hundreds have been killed has drawn international condemnation and sanctions on military figures and military-controlled entities.
Adani Ports said in May it could abandon the Myanmar container terminal project and write down the investment if it was found to be in violation of sanctions imposed by the United States.
KLP said it had been in a dialogue with Adani Ports since March this year and held a meeting with the company’s management in April.
Adani told KLP “it takes human rights seriously, and that it has a human rights policy”, KLP said in its statement.
At the same time, “Adani said it had made no due diligence assessments relating to human rights before the agreement it concluded with the Myanmar military”, KLP said.