Maldives seeks out-of-court settlement with GMR over scrapped airport project

2 January 2014 (Last Updated January 2nd, 2014 18:30)

The Maldives Government is in talks with Indian infrastructure group GMR for an out-of-court settlement over the scrapped Malé International Airport project.

The Maldives Government is in talks with Indian infrastructure group GMR for an out-of-court settlement over the scrapped Malé International Airport project.

Maldivian President Abdulla Yameen Abdul Gayoom asked Indian Prime Minister Manmohan Singh to settle the issue of Malé International Airport as well as address the problems faced by Indian investors.

Mr Yameen said: "There is nothing that cannot be sorted out through dialogue. So we are very keen to have a dialogue with GMR.

"Hopefully, we will have a mutually amicable solution."

"As we speak, GMR is speaking with our officials to have a settlement out-of-court and not through arbitration. So hopefully, we will have a mutually amicable solution."

The $500m project to modernise and operate the Malé International Airport for 25 years was awarded to GMR in 2010, marking the largest foreign direct investment by any company in the Maldives.

The Maldives Government, which was then headed by Mohamed Waheed, scrapped the project stating that the contract was illegal.

In response, GMR filed for arbitration in Singapore in June last year, seeking damages of $1.4bn for 'wrongful termination' of the airport contract.

GMR claimed that it won the contract hrough a transparent bidding process. A final order in the matter is expected by the end of March 2014.

Mr Yameen was in India on his first foreign visit after becoming the president, and stated that the airport infrastructure and construction would be taken up by the Maldivian authorities.

He added that Maldives would welcome investments by GMR in other areas.