Adani Ports, India's largest private port operator, announced its plan to withdraw its investment in Myanmar by June 2022, weeks after the firm applied for a US licence to build the Yangon International Terminal.
"The Company's Risk Management Committee, after a review of the situation, has decided to work on a plan on exiting [the] Company's investment in Myanmar, including exploring any divestment opportunities", Adani Ports informed India's stock exchanges on Wednesday evening.
The firm believed that the investment did not come under US sanctions imposed after a military coup in February this year.
In August this year, the Gujarat-based firm said that it had applied for a licence from the United States' Office of Foreign Assets Control (OFAC) to operate the Myanmar container terminal. The company had invested $127 million, including a $90 million in upfront payment for leasing land, it said in May this year.
Since the announcement of the Act East Policy in 2014, during the East Asia Summit in Myanmar, the Indian government has signed a series of agreements with East Asian countries to counter China's strategic investments in the region. On 22 October 2018, India and Myanmar signed a bilateral agreement for the operationalisation of the port at Sittwe and inland water transport terminals at Sittwe and Paletwa in Myanmar.
However, the ambitious India-Myanmar Kaladan connectivity project remains unfinished seven years after its first deadline, and is now "expected" to be completed by 2023.
On the other hand, works on the China-Myanmar Economic Corridor, which forms a vital part of the Belt and Road Initiative, have been expedited under military rule in recent months. China will get direct access to the Bay of Bengal and Indian Ocean ports after completing the CMEC project.