A Singapore-based arbitration tribunal in Singapore has ordered the Maldives government to pay US$250 million in damages to India-based GMR Infrastructure Limited over the cancellation of an agreement to develop Ibrahim Nasir international Airport (INIA).
The tribunal issued the order after an assessment of compensation payable by the Maldives government to the company.
Earlier this year, the tribunal concluded that the Maldives government’s concession agreement with GMR to develop, manage and operate INIA was valid and binding.
The agreement was signed in 2010, but the Maldives government terminated the contract two years later, saying it was “void ab initio”.
The tribunal awarded GMR US$ 250 million in damages, instead of US$1.4 billion initially sought by the company.
The US$250 million breaks down to 208 million in damages and the rest as interest for the past four years, which is 82% less than the initially claimed amount.
Speaking to the media today, Attorney General Mohamed Anil said the “government is currently in talks with GMR regarding the payment, and the compensation awarded to the company was the amount expected by the government.”
Managing Director of Maldives Airports Company Limited (MACL) – Adil Moosa said the country suffered huge losses due to the decision to award the management of the airport to a foreign company.
He said MACL earned MVR1.1 billion in profits in the first year after it took over the management of the airport.