State settles USD 271 million in compensation to GMR

Maldivian government has announced that it has settled the USD 271 million in compensation it was ordered to pay to GMR by Singapore International Arbitration Centre (SIAC) over the termination of the contract made with GMR to run Ibrahim Nasir International Airport (INIA).

SIAC made its decision and released its report regarding the case on October 25.

The announcement that the compensation has been settled was made by Attorney General Mohamed Anil during a press conference held this Tuesday evening at President’s Office.

AG Anil said that amount settled by the Maldivian government included interests and penal interests – including USD 181 million in loan and interest payment owing by GMR to Axis Bank.

“The remaining USD 86 million is what needed to be paid to GMR. It includes expenditure by GMR on the airport, and the accumulated interest. It also includes the termination cost decided by arbitration and the cost of the arbitration process,” said Anil.

Anil said that the whole compensation payment had been settled. And that the money came from Maldives Airport Company Limited (MACL) and other sources.

“The money wasn’t paid through the State budget,” said Anil.

AG Anil said that the contract made with GMR during former Maldivian President Mohamed Nasheed’s administration had not been beneficial, either to the government or MACL.

“Assessments made by our experts during the bid process, before the airport was awarded to GMR shows IFC had been neglectful as the advisory party during the bid process,” said Anil.

He said that it was noticed during the arbitration that many relevant documentations had been missing from relevant government organizations “because officials involved in it at the time had not been sufficiently attentive.”

The concession contract between GMR and Maldivian government was terminated on November 27, 2012, during former President Dr. Mohamed Hassan Waheed’s administration, after an audit regarding its financial and national safety and security implications.