The Maldivian Democratic Party (MDP) is preparing to sue former President Dr Mohamed Waheed for defamation and damages over his administration’s unilateral termination of the GMR airport development deal.
The main opposition party announced in a press statement on Thursday (June 19), following a Singapore arbitration tribunal ruling that the agreement was “valid and binding”, that it would pursue legal action against the former president and other responsible parties in both Maldivian and international courts.
“Dr Mohamed Waheed Hassan Manik and his coup partners had spread falsehoods concerning the GMR agreement, incited hostility and antagonism towards the MDP among the public, and attempted to defame this party,” the press statement read.
“And [they] plunged the nation into serious strife and discord, paved for the way for a coup, and toppled the first democratically elected government of the Maldives in a coup d’etat.”
The party contended that Dr Waheed’s administration was responsible for the compensation the Maldivian government would likely have to pay GMR – which would be “a financial burden the country cannot bear” – as well as loss of investor confidence, soured bilateral relations, and the damage to the Maldives’ international reputation.
The concession agreement signed with the GMR-led consortium in July 2010 to Ibrahim Nasir International Airport was beneficial to the Maldives, the statement continued, and its abrupt termination was unlawful.
“Void ab initio”
In November 2012, following a campaign spearheaded by Adhaalath Party President Sheikh Imran Abdulla calling for the nationalisation of the airport, Dr Waheed’s cabinet declared the concession agreement void ab initio – invalid from the outset – and gave the consortium a seven-day ultimatum to hand over the airport.
On December 7, the government took over the airport and evicted GMR, prompting the Indian infrastructure giant to seek US$1.4 billion in compensation for “wrongful termination” of the contract – an amount that eclipses the country’s annual state budget.
In a letter sent to the Bombay Stock Exchange last week, GMR explained that the arbitration tribunal concluded the Maldivian government and the Maldives Airports Company Ltd (MACL) were “jointly and severally liable in damages to GMIAL for loss caused by wrongful repudiation of the agreement as per the concession agreement.”
The determination of liability – the first of two phases of arbitration – will now be followed by the determining of compensation owed.
In the wake of the arbitration decision, Attorney General Mohamed Anil said that President Abdulla Yameen’s administration would honour the verdict while expressing confidence that the government would not have to pay the US$1.4 billion sought by GMR.
“According to the agreement, [we] mostly have to compensate for the investments made. We said we do not have to pay the amount GMR has claimed. We always said we will have to pay compensation, and that this compensation has to come through the agreement,” Anil told reporters on Thursday.
President Yameen had predicted in April that GMR would only be owed US$300 million in compensation.
Meanwhile, addressing supporters in Malé at an MDP maahefun (traditional celebratory feast ahead of Ramadan) Thursday night, former President Mohamed Nasheed argued that opposition parties misled the public to topple the MDP government in February 2012 with false allegations.
Opposition parties at the time had claimed that privatising the international airport posed a threat to Maldivian independence and sovereignty as well as Islam, Nasheed recalled.
The concession agreement with the GMR-led consortium was characterised as detrimental to the Maldives, he added, which was used as the pretext for the “coup” on February 7.
“Today it is becoming clear to us that the agreement was valid, and that it was terminated in violation of legal principles as well as international norms, in a way that causes serious damage to the Maldivian people,” Nasheed suggested.
Referring to AG Anil’s insistence that the compensation figure would not be too high, Nasheed accused President Yameen’s administration of continuing to mislead the public.
Nasheed stressed that the amount owed to GMR as compensation was not yet clear, noting however that the arbitration tribunal has ordered the government to pay US$4 million to the company to cover its legal expenses.
“The question we are asking now is, who will be paying those dollars? The dollars will be paid from our pockets. Legal action must be taken against those responsible for us having to pay these dollars,” he insisted.
“We have to seek compensation for the damage caused to our government. We know, we can see, that President Yameen’s government will not last. We know that President Yameen’s government does not have the support of the people. They cannot rule over all of the people in this country with the support of just 25 percent of the public.”
Changing the current government was “a duty and an obligation” for the MDP, the former president said, advising supporters not to despair.
“God willing, our courage will not flag. We will not be afraid and we will not back down either,” he said.