New Delhi, Dec. 3:
In what could spell more trouble for the Bangalore-headquartered GMR
Group, the Maldives Government has said that its decision to cancel the Male
airport modernisation was “non-reversible and non-negotiable”.
Earlier in the day, the Singapore High Court had ruled in favour of the
GMR consortium saying that the Maldives Ministry of Finance & Treasury and
Airports Corporation Ltd are not allowed to interfere either directly or
indirectly with the rights of the investor (GMR consortium) under the
concession agreement.
“GMR has to vacate the airport by December 7. We will pay compensation.
The process has been initiated. The exact amount of compensation will be
decided later,” Masood Imad, Press Secretary to the President told Business Line on
phone from Maldives.
Masood’s statement came hours after the Singapore High Court’s ruling in
favour of the GMR consortium.
Following the Singapore court’s ruling, GMR issued a statement saying,
“GMR Maldives International Airport Ltd shall continue to operate the Ibrahim
Nasir International Airport as usual as per the provisions of the Concession
Agreement.”
The GMR Group had moved a Singapore court against the November 27
Maldives Government decision to cancel its contract to modernise the airport.
GMR has been asked to hand over the airport back to Maldives Airports
Corporation Ltd by December 7.
In a statement the Maldives Government said “Our decision was based on
legal advice we got from lawyers in Singapore and the UK. We believe that the
judge was incorrect in interpreting the law as, where compensation is adequate,
an injunction cannot be issued and a court cannot issue such an injunction
against a sovereign state.” The contract stipulates that in case of differences
between various parties, either the UK or Singapore law would apply.
There was no immediate official comment from the GMR group, although
sources in the company maintain that they have till December 7 to decide on
their next move. At about $500 million, this is the largest foreign direct
investment in Maldives. The GMR-led consortium won the project to modernise the
airport in 2010 through a global tender.
The GMR stock price closed 5.36 per cent up at Rs 19.65 on the BSE.
ashwini.phadnis@
thehindu.co.in
Deal OFF GMR-Malaysian Airport joint venture awarded contract to
modernise airport on June 28, 2010 Contract allows GMR Male International
Private Ltd to collect $25 Airport Development Charge and $2 insurance
surcharge from January 1, 2012 The contract signed with GMR questioned
following overthrow of President Mohammed Nasheed in February 2012 Arbitration
begins in July 2012 November 27: Termination of contract notice issued and GMR
given seven days to hand over asset
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