Government refuses to pay $800 million to GMR

The Maldivian government has said that it should not be required to pay $800 million as earlier indicated by GMR, as compensation for terminating the agreement.

In an interview to Indian online paper Economic Times, GMR Chief Financial Officer Sidharath Kapoor said that a letter had been sent to the Maldivian government indicating a number over $800 million as the compensation amount.

When asked about this, Press Secretary at the President’s Office Masood Imad told the paper that investigations so far have shown that GMR had invested $150 million out of the about $350 million loan obtained by the company.

“We will go in for a forensic audit as we want to see how much money has poured in to GMR coffers through the Male’ International Airport and how much actual money has been spent here. As per our information, GMR has cashed in only $150 million of the about $350 loan it had bagged through a bank,” Masood Imad said.

Kapoor responded to this and told the paper that GMR’s books are transparent, and that the concession agreement signed with the Maldives government did not have a clause of forensic audit. “Having said that, I must add that we don't have any objection to an audit but it has to come through proper legal process,” he said.

The paper referred to Maldivian government sources and said that the compensation amount, as per their calculations, should be between $150 million and $350 million.

“We will present our case before the Singapore Court and let them take the call,” Economic Times quoted a Maldivian government source.

The paper further said that the Maldivian government has said that they have nothing against GMR, and that GMR is welcome to bid for future projects in the Maldives.

Meanwhile, Malaysian Airports Holdings, which held 23 percent shares of the consortium and invested $6.6 million, has said that it had made a profit of $13.2 million. GMR operated the airport such that all trade at the airport was managed by GMR. GMR’s books reveal that Male’ Airport was the most profitable airport operated by the company.