Nordic KLP fund splits from Adani Ports over links with Burmese military


A general view of a container terminal is seen at Mundra Port, one of the ports operated by Adani Ports and Special Economic Zone Ltd, in Gujarat state, western India, April 1 2014. REUTERS / Amit Dave

OSLO, June 22 (Reuters) – Norwegian pension fund KLP withdraws from Adani Ports and Special Economic Zone Limited (APSE.NS) on grounds that the company’s ties to the Burmese military violate investment policy responsible for the fund, KLP told Reuters on Tuesday.

Adani Ports, India’s largest port operator, has come under scrutiny from international investors for its plan to build a container terminal in the city of Yangon on land leased from a Burmese military conglomerate.

A military coup in Myanmar on February 1 and the crackdown that followed mass protests in which hundreds of people were killed sparked international condemnation and sanctions against military figures and entities controlled by the army.

“Adani’s operations in Myanmar and its business partnership with that country’s armed forces pose an unacceptable risk of contributing to the violation of KLP’s responsible investment guidelines,” KLP said in a statement to Reuters.

A Burmese military spokesperson did not respond to Reuters calls for comment.

KLP, Norway’s largest pension fund, had a nine million kronor ($ 1.05 million) investment in Adani Ports at the time of its decision, he told Reuters.

This was divestment because the container terminal is built on land owned by the Burmese military and there is an “imminent danger” that 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 military to prosecute its human rights violations,” KLP said.

Adani Ports was not immediately available for comment.

Adani Ports said in May that he could abandon Myanmar’s container terminal project and write down the investment if it were found to be in breach of sanctions imposed by the United States. Read more

KLP said it has been in dialogue with Adani Ports since March of this year and held a meeting with company management in April.

Adani told KLP “he takes human rights seriously and has a human rights policy,” KLP said in his statement.

At the same time, “Adani said he did not do any human rights due diligence assessment before the deal he made with the Burmese military,” KLP said.

($ 1 = 8.5996 Norwegian crowns)

Additional reporting by John Geddie and Sudarshan Varadhan Editing by Robert Birsel

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