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Billionaire Gautam Adani's power generation unit is stepping up pressure on Bangladesh as it seeks to recover more than $850 million of unpaid electricity bills, according to people familiar with the matter.

Adani Power Ltd. reduced its supply to Bangladesh by half last week and may cut the nation off entirely from Nov. 7, said the people, who asked not to be named as the internal discussions are not public. Adani Power is asking the neighboring nation's power agency to arrange a letter of credit or repay the money, one person said.

A representative for Adani Group did not offer any immediate comment on the deadline for cutting power supplies. Muhammad Fouzul Kabir Khan, the interim head of Bangladesh's power ministry, did not respond to phone calls seeking comment.

A pullback by Adani Power, that has been providing electricity to India's neighbor from its coal-fired plant in the eastern Indian state of Jharkhand, raises the risk of further blackouts in a nation grappling with a financial and energy crisis after weeks of violent protests overthrew Sheikh Hasina's government earlier this year. It also adds to headwinds faced by nation's interim government, led by Muhammad Yunus, that's already tackling billions of dollars in arrears.

Bangladesh's current administration is expediting payments to Adani Power, Shafiqul Alam, a government spokesman, told reporters in Dhaka on Sunday.

The country is hoping to "repay about $700 million to Adani as soon as possible," Alam said, adding that arrears were mostly a legacy from the previous administration.

A Times of India report on Sunday reported that Adani's power generator has set a Nov. 7 deadline for Bangladesh to meet its obligations. When asked about this media report, Alam said "we're dismayed and shocked if the report is true." He did not specify if a formal communication on this had come from the Adani Group.

The delayed payments underscore the financial and geopolitical risks facing the Indian conglomerate, led by Asia's second-richest person, as it steadily expands its global footprint across Israel, Kenya, Tanzania, Sri Lanka and Bhutan besides Bangladesh.

Adani Power's move exacerbates the electricity deficit in the country of about 174 million people. Bangladesh is facing an overall daily shortfall of about 1,500 megawatts, according to government data.

The government is "trying its best to accelerate all international payments," Alam said on Sunday. Bangladesh won't be "hostage to any individual power producer no matter how powerful they are."

Signals escalation

The developments over the weekend signal an escalation by the ports-to-power conglomerate after it warned Bangladesh Power Development Board, or BPDA, in an Oct. 28 letter from Adani Power seen by Bloomberg News.

The company will start "suspending power supply" if it did not received a letter of credit or its dues worth $846 million remain unpaid by Oct. 31, according to the letter.

"We have been facing tremendous difficulties in managing working capital for making payments to coal suppliers" and other vendors due to outstanding payments and "non-availability" of a so-called Letter of Credit, Adani Power said in this communication. "Also, our lenders have withdrawn the working capital support."

The reduction by Adani Power began on Thursday night with its 1,496 MW plant now producing just 700 MW, according to another Indian media report.

Bangladesh Bank's Governor Ahsan H. Mansur told Bloomberg News in August that there was a risk of losing power supply if Adani Group wasn't paid its dues.