Prime Minister Malcolm Turnbull is expected to speak with the global head of mining giant Adani on Monday amid mounting speculation the government will contribute $1 billion for a railway line to serve the forthcoming Carmichael coal mine.
No formal meeting is scheduled but both men will be in Melbourne for the Australia-India Leadership Dialogue and will likely speak on the sidelines as pressure grows for the Commonwealth to chip in half the costs of the $2.2 billion rail project.
It is understood that while Adani has expressed interest in accessing the Northern Australia Infrastructure Facility to subsidise its North Galilee Basin Rail Project, no final decision has been made and no announcement will be forthcoming this week.
The newly minted $5 billion infrastructure fund last week granted preliminary approval for the subsidy, pending a full assessment, reportedly saying the project met basic financial, economic and employment requirements.
During the election campaign, Mr Turnbull said there was no public funding for the giant mine, and Energy Minister Josh Frydenberg has said the project "needs to stand on its own two feet".
However, they left the door open for related infrastructure funding via the independent NAIF, which was established on July 1 and is chaired by former Brookfield Multiplex director Sharon Warburton. It is yet to approve funds for any project.
Adani Group chairman Gautam Adani will attend the high-level dialogue in Melbourne on Monday and then head to Townsville, where he is expected to join Queensland Premier Annastacia Palaszczuk to announce Townsville as the mining project's regional base.
Minister for Resources and Northern Australia Matthew Canavan would not comment on Sunday but a spokeswoman said financing of the rail project was "a matter for the independent, expert board" of the NAIF to assess.
Environmental groups were outraged by reports the government was moving closer to granting the $1 billion loan. Tim Buckley, analyst at the Institute of Energy Economics and Financial Analysis, said Australian taxpayers should not give "subsidies to foreign billionaires", despite the 1500 jobs that could be created by the mine.
"If you were to provide a billion dollars for solar projects across Australia you would probably create 3000 jobs," Mr Buckley told Fairfax Media. "It's farcical that they're paying out a foreign billionaire and they're doing it into structures that are clearly in tax havens."
The gigantic Carmichael mine first received federal government approval in 2014 but had to be re-approved after a successful legal challenge on environmental grounds. The mining leases received state government approval in April and was declared "critical infrastructure" in October.
Coal generated at Carmichael will be shipped from Abbot Point to India, where it is expected to generate electricity for up to 100 million people. Adani, a global conglomerate with connections to Singapore and the Cayman Islands, wants to begin work next year.
Queensland's State Development Minister Anthony Lynham told Fairfax Media in October he was satisfied suitable environmental protections were in place and that people in central and north Queensland "want this mine to go ahead".
