Guwahati, June 2: In a major blow to Assam’s renewable energy drive, the Asian Development Bank (ADB) has formally cancelled a $434.25 million loan for a large-scale solar power project in Karbi Anglong, following allegations of indigenous land rights violations that stalled the initiative.
The decision, confirmed on May 28, came just days after the Indian government withdrew its request for financing on May 23, amid sustained pressure from the Indigenous Peoples Party (IPP) and local tribal communities.
The scrapped funding was intended for a 1,000 MW solar photovoltaic facility with integrated battery storage, alongside power distribution upgrades by the Assam Power Distribution Company Ltd. (APDCL). But the project ran into fierce opposition from tribal villagers in Lahorijan, who claimed the land transfer for the project had bypassed their consent and violated constitutional protections.
The IPP filed two formal complaints with ADB’s Compliance Review Panel (CRP), first in November 2024 and again in February 2025, on behalf of over 80 tribal residents from 23 affected settlements. At the heart of the complaints was the alleged allocation of 18,000 bighas (around 2,400 hectares) of ancestral land by the Karbi Anglong Autonomous Council (KAAC) to APDCL without transparency, proper consultation, or free, prior, and informed consent—a requirement under both India’s Sixth Schedule and ADB’s Safeguard Policy Statement (2009).
Villagers reported a slew of violations: forced land acquisition, loss of farmland and livelihoods, cultural disruption, and corruption in compensation processes. Some alleged that middlemen demanded bribes to include names on official beneficiary lists.
Following a field visit, virtual consultations, and document reviews, the CRP deemed the February complaint eligible for a full compliance investigation, citing serious gaps in the project’s adherence to ADB’s social safeguards, particularly regarding involuntary resettlement and Indigenous Peoples’ rights.
However, before the compliance review could proceed, the Government of India, through its representative on ADB’s Board, formally withdrew the financing request. Although the loan had been approved in October 2024, the agreement was never signed, rendering the project defunct.
ADB confirmed that it will publicly release the CRP’s eligibility report along with an addendum acknowledging the government’s withdrawal, in keeping with its transparency commitments.
The collapse of the project marks the failure of what was to be a flagship initiative in Assam’s renewable energy roadmap. In addition to the ADB loan, the project was to be co-financed with $129.77 million in private investment and $108.66 million in public funds.
The role of the KAAC remains under scrutiny. A key question pending before the National Commission for Scheduled Tribes (NCST) is whether the Council had legal authority to allocate the land, or if it merely held it in trust for the indigenous communities.
While APDCL has yet to issue a public statement, IPP president Rajen Timung called the loan withdrawal a “landmark victory” for tribal rights. “No development project should override the will and consent of our people,” he said. “This decision sets a precedent that indigenous voices must be heard.”
Also Read: Prof. Sumarbin Umdor appointed Pro VC of NEHU Shillong Campus
Also Watch
Find latest news from every corner of Northeast India at hubnetwork.in, your online source for breaking news, video coverage.
Also, Follow us on-
Twitter-twitter.com/nemediahub
Youtube channel- www.youtube.com/@NortheastMediaHub2020
Instagram- www.instagram.com/ne_media_hub
Download our app from playstore – Northeast Media Hub
