A Singaporean arbitration tribunal has ordered the Maldivian government to pay USD 208 million (MVR 3.2 billion) in damages to India’s GMR Group, over the cancellation of the 25-year agreement to develop and run Maldives’ main airport, Ibrahim Nasir International Airport (INIA).
The Singapore International Arbitration Centre (SIAC) issued the ruling on Tuesday (October 25).
Delivering a statement at the President’s Office on Thursday, Attorney General Mohamed Anil said the Maldivian government was ordered to pay a total of USD 250 million, including USD 208 million in damages and interest for the past four years.
Anil said financial and legal audits related to the concession agreement were done prior to its termination, and that the audits revealed that the agreement was in such a way that GMR could reap its benefits while the Maldivian government and Maldives Airports Company (MACL)’s rights and interests were greatly compromised. He therefore said the agreement was cancelled, taking into account the damages it would incur on the country.
After cancelling the agreement, the Maldivian government initiated the arbitration on November 29, 2012, seeking to declare the agreement void. However, in June 2014 the tribunal ruled in favor of GMR declaring that the agreement was valid.
Subsequently GMR made a claim for USD 1.4 billion as compensation. But according to Anil, government was asked to pay only about 18 percent of the amount, which he said, is close to the figure President Abdulla Yameen estimated in April 2014.
The Attorney General said, following the tribunal’s ruling, government is holding discussions with GMR Group regarding the payment.
GMR took over the management of INIA on June 28, 2010, during the Nasheed Administration. The agreement was terminated on November 27, 2012 by the Waheed Administration.