Maldives repays US$50m loan to India

The Maldives government has this week repaid a US$50m loan  originally supplied by India to the previous administration of former President Mohamed Nasheed, local media has reported.

Citing senior government officials, local newspaper Haveeru reported that the repayment has been made Tuesday (December 4) after the Indian government said it would not be extending the repayment period for the funds.

India late last month requested that the Maldives government make US$50 million in treasury bond (T-bond) payments to India by December, with a second equal payment scheduled to be made in February 2013.

Diplomatic dispute

The Maldives government was in recent weeks been drawn into a diplomatic row with its Indian counterparts over a decision to dismiss an injunction granted to India-based infrastructure group GMR by the High Court of Singapore over the managing Ibrahim Nasir International Airport (INIA) in Male’.

Authorities in the country have opted to void the contract signed by GMR and the previous government, whilst vowing that the airport will be run by the state-owned Maldives Airport Company Limited (MACL) by Friday (December 7) even with the injunction issued by the Singaporean courts.

Indian media has meanwhile claimed that the Indian government is considering freezing aid to the economically-crippled archipelago, notably a US$25 million loan necessary for the payment of civil servant salaries and the construction of a police academy.

“We are not happy with the way Maldives cancelled the GMR airport deal. This has surely left an impact on our bilateral ties,” a foreign ministry official told AFP. “A decision whether the money should be given or not will be taken soon.”

However the Indian High Commission n Male’ has previously stressed to local media that the suggestion of cutting aid was “unofficial”, adding that such a decision would not be “unilateral”.


4 thoughts on “Maldives repays US$50m loan to India”

  1. Indian Aid is a very important component of our economic development but this does not mean that we need to like the ass of Indian either.

    GMR deal is the biggest corrupted deal happened in this country. Maldivian Government can not afford to pay GMR to run the airport . The deal is in such a way that government need to subsidize GMR to run the airport when GMR is earning in millions of dollars.

    Indian Government should also see these points and check how fair the deal was. They should also understand that it is not fair for the government to pay millions of dollars to GMR from the public money when GMR is getting revenue from airport operations in millions.

    If Indian Government does not help the country, I guess we may get help from other countries and there many more countries in this world and is not only India who will assist us.

    But having a long history of bilateral relationship between the two countries, I do not want to see this relationship get murky due to GMR issue.

  2. Dear mody,

    1) When you make a claim, you need to substantiate it.

    For instance, when you say "GMR deal is the biggest corrupted deal happened in this country", it may well be true but your word, or Hassan Saeed's word, is simply not good enough.

    Where is your evidence for the said corruption? Allegations are not evidence.

    The IFC, a World Bank body, oversaw the process. A leaked ACC report reveals no evidence of improper deal.

    2) " is not fair for the government to pay millions of dollars to GMR from the public money when GMR is getting revenue from airport operations in millions"

    Maybe it is not fair. But is it legal? Yes. Is the Waheed regime's threat to forcefully evict GMR legal? No.

    There are obligations made by the government (no matter how unfair you think they are) that need to be upheld.

    To wilfully disregard the terms of contract, period of notice, and an injunction made by the agreed arbitration court is hugely dangerous to the investment climate. The implications are larger than merely the GMR deal.

    Think of the millions of dollars that will be lost in potential investments due to the Waheed regime's destructive attacks on the largest foreign investor in the country.

    3) GMR is no fly-by-night operator. If you visit their airports in Hyderabad and Delhi, you'll see beautiful professionally run terminals.

    I keep hearing that MACL could do a 'better job' running the airport.

    My only response is: if they could have, why didn't they?

    MACL had the airport for 40 years. Why was the airport crumbling and leaky?

    An airport is the entry point to the country that makes the first impression on visitors. If the government doesn't have the capital to pay its own civil servants, how are they to upgrade an airport? To think the MACL will magically find the millions of dollars required to upgrade the airport is curious.

    If they do find this money (that they couldn't before) who is paying them? China? Pakistan? These are countries that worry me much more than India.

    The final point I'd make is.. running a major infrastructure upgrade is not the same as running a coffee shop.

    Roads and bridges in themselves don't necessarily make you money. But they strengthen the frameworks on which the economy is built - in this case - larger terminal, greater capacity, more tourism.

    Waheed's disastrous regime full of radical mullahs and Gayoom era enemies of the Nation has managed to run the country into the ground in less than an year.

    And I have a feeling this unelected regime is going to leave us as a pariah state.

    [As an aside: Dear India, this is why we asked you to side with democracy in February. Look at the price we all pay!]

  3. Yaamyn,
    Explain me why GMR got disqualified in the first round and why did Anni decided to award the contract to a company who was disqualified when there were three other companies qualified in the first round? Does this explain the corruption. ?

    2. Why did Anni dissolved the existing board and appointed a new board got the contract sinned less than 24hrs from the appointment of the new board ?
    Does this look fishy ?

    3. IFC is international body and they have taken over 3 million dollars as a consultation fees legally and many of the people who had observed on behalf of IFC were Indian and they had an understanding with GMR to get the deal through..

    4. I am sure that it bit too early to talk about the evidence and there are enough evidence to prove the corruption involved in the deal. You need to wait for bit more time and things will start unfolding once GMR is gone.

  4. Next time, mody, stop taking handouts from the police state and work honestly. People like you are why we had to get investors in the first place - because you people are lazy and too highminded to take part in construction work.

    Kindly remove yourself from the Maldivian gene pool as a favor to the more hardworking and diligent Maldivians.


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