President Mohamed Waheed Hassan Manik said that even though the agreement with GMR, India does not benefit the Maldives, annulling the agreement would carry a serious financial burden for the State.
In a letter to pro-government coalition parties requesting suggestions on how the government needs to proceed with the GMR case, President Waheed stated that as the GMR agreement must be considered as legally valid, annulling the agreement will incur the State a huge financial amount as compensation to GMR and that it would not be easy, due to the present economic situation of the country.
“This could obscure the positive image of investors towards Maldives as potential investment destination and that it could undermine foreign relations and the friendship between India and Maldives, I believe that these should be reflected on while considering a decision,” “Having said this, I request your opinion on the matter as soon as possible,” the President said in the letter sent to the party leaders.
The letter also stated that as requested by the party leaders during their meeting last Thursday, a paper on the economic forecast of the GMR agreement and an estimated cost of annulling the agreement had been provided along with the letter.
President Waheed said that the while the GMR agreement had not been revised, the loss due to what has been foregone is more than the estimated income. He said that focusing on the situation at present, the amount payable to GMR by the government during the period of the agreement is much higher.
“In addition, the development planned for the airport is less than what has been planned in the airport development master plan (Stock Wilson plan) and more expensive than mentioned in the Stock Wilson plan. Hence the transaction is estimated to incur a major loss (including the individual businesses which operate at the airport) to the Maldivian economy,” the President said.
The President’s Spokesperson Abbas Adil Riza said on Tuesday that the reaction of the party leaders except DRP, towards the issue has been made clear at the news conference held on Monday and that other parties are responding through replies to the letter. All parties except DRP believe that the GMR agreement should be annulled.
Abbas said that the DRP leader Ahmed Thasmeen Ali had shared the details of the letter by the President, to the media this morning in a misleading way.
“Thasmeen spoke in such a way that it felt that the GMR agreement cannot be annulled. However, the President’s letter did not imply as such. He (President) did not reflect an attitude of not doing so. The letter was intended to obtain the opinion of the coalition party leaders on the issue. The letter did not state any decision,” Abbas said.
However, Thasmeen this morning said that while President Waheed is stressing that annulling the agreement and compensating GMR would be a burden, it would not be easy to say “however” and call to get out of the agreement on the very same day.
He said that it is up to the judiciary to decide the validity of the GMR agreement and that the government should still work towards it. He also added that he would welcome such a decision.