Maldives issues notice to GMR for terminating airport pact

Moneycontrol Bureau

The Maldives cabinet has recommended termination of a contract given to GMR Group for developing Male Airport, a project awarded to the Indian group during the previous regime of island nation. In a meeting today, the cabinet decided to terminate the contract and a notice to this effect was issued to GMR Group, Maldivian President's Press Secretary Masood Imad said in a statement.

The USD 500-million project was hanging in balance ever since the regime change in Maldives earlier this year. The GMR group had won the contract during the regime of former President Mohamed Nasheed. Some coalition partners of the current regime headed by Mohamed Waheed had also held a rally against GMR on November 3.

The airport contract was awarded to GMR through a 10-month long global competitive bidding process run by the then Maldivian government headed by Nasheed.

Nearly eight months after the regime change in Maldives, some Indian companies present there, including GMR, are blaming political interference for creating "undue challenges" for them.

In its response, GMR called the move "completely irrational". The company alleges that the decision is "unlawful and premature" and derived on the pretext that the concession agreement [CA] is 'void'

The company plans on challenging the Maldives cabinet's decision. "We would also like to inform all that this action by the GoM is in complete disregard of and has been done during the pendency of Arbitration proceedings in the designated Tribunal in Singapore," it said in its press release.

"We are therefore taking all measures to ensure the safety of our employees and safeguard our assets.  We are confident that the stand of the Company will be vindicated in every way," GMR spokesperson said.

With inputs from PTI