Failed to initialize kubernetes configuration when using terraform plan

I've migrated my old terraform install from some 1.0 version (sadly, don't remember which exactly) to latest, installed with nix

terraform -v                                                                                                                      
Terraform v1.1.7
on linux_amd64

After issuing terraform plan i'm getting the following error:

Error: Failed to initialize kubernetes configuration: context "redacted-context" does not exist

My main.tf configured with k8s backend as following:

terraform {
  required_version = ">=0.13.0"
  backend "kubernetes" {
    secret_suffix    = "redacted-suffix"
    load_config_file = true
    config_context   = "redacted-context"
    namespace        = "redacted-namespace"
  }
}

Using strace -f terraform plan i don't see any attempts to read ~/.kube/config

How can i make terraform to read and use deafault kubeconfig?

Setting KUBE_CONFIG_PATH=~/.kube/config forces terraform to read specific config, as per https://www.terraform.io/language/settings/backends/kubernetes#configuration-variables

It's unclear, however, why this issue happened in a first place