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Corporate Dec 16, 2012

Malaysia to discuss GMR airport issue with PM

Hyderabad: Malaysian Prime Minister Najib Tun Razak, who is scheduled to visit New Delhi for India-Asean meet between December 20-21, is likely to discuss with Prime Minister Manmohan Singh the issue of GMR's now scrapped Male Airport project in which MAHB holds 23 percent stake.

"The heads of the governments (Malaysia and India) are going to meet in New Delhi next week. There may be some discussion (on Male airport issue). There will be sideline meetings in Delhi," Malaysia's Consul General in Chennai Citra Devi Ramiyah told reporters here.

Malaysian government owned MAHB holds 23 percent. Reuters

Malaysian government owned MAHB holds 23 percent, while GMR holds 77 percent stake in GMR Male International Airport Pvt Ltd, a joint venture formed for developing Ibrahim Nasir International Airport in Maldives.

The Malaysian Prime Minister is visiting New Delhi on December 20 to commemorate 20 years of India-Asean
partnership. He is expected to meet Prime Minister Manmohan Singh during his visit.

Ramiyah said the Malaysian government has not yet initiated any move towards claiming compensation form the Maldivian Government for abruptly terminating airport.

The new Maldivian government had on November 27 terminated the contract given to GMR-MAHB consortium in 2010 during the previous regime of President Mohamed Nasheed. The issue had sparked protests from both Indian and Malaysian governments. When asked whether MAHB is moving a petition for compensation from the Maldivian government, the diplomat said: "At this juncture it is very early to comment because the Singapore court had just made the decision.

The Maldivian government wants to do the project on its own and willing to compensate financially. So, it is very early for us to comment." The Maldives government had terminated the $500 million project. The Singapore Supreme Court ruled that the Maldives government has the "power to do what its wants including expropriating the airport".

GMR handed over the airport operations on December 8 to Maldives government. The contentious issue saw various twists and turns both on legal and diplomatic fronts with India expressing its strong displeasure over the "unilateral" decision of termination and had conveyed that the move will have an adverse impact on the bilateral ties.

Malaysian Minister of International Trade and Industry Seri Mustapa Mohamad said what happened in Maldives is unfortunate and hoped that the Island nation will relook into its decision. "In Male we have enjoyed very close ties with the previous government for many years. Maldives is 100 percent Muslim country. Of course, with the new government the lesson for us is we should be more careful, more due diligent," Mohamad said.

"We want our investments to be protected. There was legitimate contract signed. We are disappointed," he added. The Malaysian minister is touring India with a delegation to promote more trade and private sector collaboration between Malaysia and India.

The bilateral trade between India and Malaysia is expected to touch $15 billion by 2015, Mohamed said. The Malaysian minister said India's bilateral trade with Malaysia stood at nearly $12.54 billion last year compared with $8.98 billion in 2010.

PTI


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