The Indian Prime Minister Dr Manmohan Singh had a bilateral meeting with the Malaysian Prime Minister Mohammad Najib Abdul Razajk on the margins of the ASEAN-India Commemorative Summit.

“The (GMR) matter was mentioned. I would not say that it was discussed in great detail. It was mentioned and we wanted an update on their impressions because the Foreign Minister had visited Maldives briefly for day. I think that his takeaway was more or less the understanding that we have,” said the Indian External Affairs Minister Salman Khurshid here on Friday.

The Malaysian public sector MAHB has 23% equity while Indian construction major GMR holds 77% in the joint venture GMR Male International Airport Pvt Ltd (GMIAL) formed to develop the Ibrahim Nasir International Airport in Male.

The GMIAL bagged the $ 500 million contract through the process of global bidding in 2010 when the erstwhile government of President Mohammed Nasheed was in power.

The present government of President Mohammed Waheed Hassan scrapped the $ 500 million deal on November 27 which led to India raising concern over the fate of India’s largest investment deal and urging Maldives to ensure safety and security of Indian people and assets.

Khurshid said that both India and Malaysia was disappointed.

“The disappointment that we felt, I think we have a right to feel disappointed, was also felt by them,” he said.

However, the cancellation of the contract was not based on the performance of GMIAL.

“They (Malaysian Government) have also been able to secure from Maldivian Government a letter in some form that indicates that quality of performance was not the ground at all for termination of the contract. I think this was necessary for Malaysia for its future prospects elsewhere. That was not something that we had asked for or called for. Therefore, we have not received any such letter,” Khurshid said.

India has suggested to Maldives that if there were any political overtones in the matter it should be contained and not spill over to damage the relationship between the two countries.

“If there were and are any political reasons, we would like, and we suggested to Maldives that we would like them to be contained and not spill over into a very important, very valuable relationship that we have with Maldives. I think that point also has been taken. It was more or less a confirmation of this that we have got from the Malaysian side,” Indian External Affairs Minister said.


Khurshid said that apart from this there were two separate issues involved which should not be confused or converged. One issue is a pure assessment of the contract and legal steps taken on that contract, which has now gone to arbitration in Singapore. The arbitration is expected to come to some definite conclusions including the entitlements of GMR after the contract was terminated.

The GMR has sought $800 million compensation from the Maldivian Government for termination of the contract.

Recently on December 6, the Singapore High Court, which is acting as arbitrator in the matter, had given a ruling in favour of the Maldives government. The Maldives government has asked GMIAL to vacate and remove all property from the airport within 30 days.

“For the present, the rulings of the Singapore court relating to termination of that contract itself are binding on all parties. That is what we have been saying all along that whatever decision needs to be taken must be compliant with and consistent with decisions of courts whose jurisdiction has been accepted by both parties. This is the feedback we had from GMR that they have accepted that, the legal consequences of the judgment in Singapore,” Khurshid said.

He further said : “But they (GMR) have obviously desired that there should be quick implementation of the subsequent consequences that arise from termination of the contract including compensation, damages, etc. We have no report that there is any negativity as far as that is concerned.”