In 2010, GMR Infrastructure Limited entered into a Concession Agreement with Government of Maldives to upgrade Male international airport in the Maldives.

The bid was organized by World Bank's International Finance Corporation and supported by AusAid (Australia), Ministry of Foreign Affairs of the Netherlands and DevCo.

Under the contract signed in 2010, GMR was to modernise and operate the airport for a period of 25 years. In 2012, the US$500 million airport development project was unilaterally canceled by the then Maldivian government headed by President Mohamed Waheed.

As we reported, in June 2014, GMR Infrastructure announced that an International Arbitral Tribunal​ declared its concession agreement to upgrade Male international airport in the Maldives was valid.

The Tribunal said the concession agreement was valid and binding and was not void for any mistake of law or discharged by frustration. The Government of Maldives and Maldives Airport Company Limited was asked to pay GMR US$4 million by way of costs within 42 days. This was far away from the US$1.4 billion that GMR was seeking for compensation over the Maldives Government's decision to terminate the PPP contract to develop Male international airport.

The company reported in a statement:

It has always been our firm belief that the cancelation of our concession agreement amounted to wrongful repudiation by the Government of Maldives and the Tribunal has upheld this stand.We believe that this award is a validation of the high standards of conduct and commitment followed by GMR Group as a leading infrastructure developer. It further endorses GMR Group's excellent reputation as a world class airport developer and operator.

Now, Maldives airport arbitration tribunal has ruled that such damages payable by Government of Maldives to GMR Infrastructure will also include all the sums lent by Axis Bank Singapore to GMR Infrastructure under the facility agreement. 

Therefore, the project debt covered by the mentioned loan will be added the other damages/compensation payable by Government of Maldives to GMR Infrastructure in terms of the first part final award.

The quantum assessment of the entire damage/compensation payable by Government of Maldives is expected to be completed sometime around the end of the third quarter of 2016.