GMR claims $1.4 billion compensation for Maldives airport

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GMR claims $1.4 billion compensation for Maldives airport

GMR reported in late April that is seeking a US$1.4 billion compensation claim over the Maldives Government decision to terminate the PPP contract to develop Male international airport.

GMR's statement came after Maldivian media quoted President Yameen Abdul Gayyoom as saying that the island nation will try to reduce the compensation amount to GMR. 

Yameen Abdul Gayyoom stated:

We believe that the government will have to pay compensation to GMR at any cost. We're trying to get the sum that we have to pay lowered. We're trying to get it reduced to a more plausible sum.

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

GMR officials stated:

The forceful takeover of the airport by the Maldives government amounts to repudiation of a valid contract and therefore damages, including loss of future profits, has to be paid. Thus, GMR's claim is $1.4 billion.

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

The two sides are currently in arbitration before the Singapore Court of Appeal and preliminary hearings that would structure the arbitration process over the case concluded in mid April.

This was the first time the Maldives government acknowledged that compensation is to be paid to GMR, although it maintained that the award was wrongful.

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