Dr.Waheed to Cancel GMR Agreement with Chinese Backing

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Given the conditions under which President Dr Mohamed Waheed Hassan came to power, he has been under immense pressure from the opposition and international community as well. Then he faced the unfortunate pressure from within his coalition government when they escalated their demands to annul the GMR concession agreement. He wouldn’t want to make them unhappy, lest he face the same fate as his predecessor. But then, annulling the GMR agreement is not feasible given the current financial situation of the country, with the government borrowing from india to pay civil servant’s salaries and IMF continuously asking to cut expenditure. So, in a letter sent to his coalition partners Dr.Waheed noted that “the losses incurred by the government are much greater than the income received during the period of the agreement”. And it didn’t help when the issue of GMIAL setting-off  the loss on account of non-levy Airport Development Charcge (ADC) and Insurance Surcharge (IS) arose.  Without much victory even on the legal front we started hearing the government is seeking another “solution” to the problem.

Meanwhile, GMR made it clear that they are ready to hold talks and even compromise within agreement framework. In a letter sent to the Dr.Waheed on 21 November 2012, they even proposed to exempt all Maldivian passport holders from paying ADC by charging USD 28.00 from all international departing foreign passengers instead. He did not respond to this letter. Pressure from his own allies was building, with religious radicals giving him ultimatums and threatening to bring him down within days.

To back their claim that the annulment of GMR agreement would greatly benefit the people of Maldives, the anti-GMR alliance started to misinform the public and even the president himself. For instance MACL claimed they could earn MRF60 billion will be earned as profit as opposed to MRF 21 billion they will earn with GMR-MAHB over the concession period till 2035, a claim based on what seems to be deliberate misinformation and misleading analysis of the situation. Another claim is that GMR-MAHB would take over STO’s fuel business, which is utterly rediculous coming from such a well reputed company. All this may have appealed to  the people rallying behind the anti-GMR alliance, but it certainly could not have mislead the government. Even then, on 21 November 2012, GMIAL sent a detailed report highlighting the benefits of the concession and refuting MACL’s claims. GMR made it clear that they were open to clarify anything, and still open to discuss issues with the government. On the other hand, anti-GMR alliance was demanding the termination of the concession agreement unconditionally and immediately. He was now facing a non-negotiable ultimatum, he must decide very soon.

Dr.Waheed and his government did not give a clear response to their demands, but still the alliance decided to give him more time, saying they were happy with how he is responding. And out of the blue, we heard Dr.Waheed’s cabinet on Tuesday’s cabinet meeting will  be decide to repeal the concession agreement. The only way this could work out is for someone to pay off the huge sum of money, the “loss” he spoke of, for the government. Who in Maldives can pay USD 1.5 million per month? No one. Unless it is coming China! Then everything makes sense. China will be paying off these through an intermediary company registered in the Maldives, while rewarding Dr.Waheed with a handsome amount for the upcoming elections to show their gratitude. A win-win for him, since he won’t have to worry about the rivals within his own coalition now. His dream of running for president with the coalition backing could come true with this deal. Or so he would think.

The people of Maldives, on the other hand will suffer for long because of this deal. This whole issue has already strained the long standing relation between India and Maldives. Involvement of China in our business will not only affect the benefits we get from India, it will also push the whole region into trouble. United States will want to make sure their ally India’s dominance in the region is not shadowed by Chinese involvement in this region. It would be of more concern especially given our strategic location and already rising radical islamism in the country with much anti-Indian and anti-American sentiments involved. All previous government have made it very clear that the Maldives will always stand with India, and keep a good relation with China as well. This game of playing China against India won’t benefit us or the region in any way.

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3 Comments

  1. Ahmed says:

    Never thought Dr. WAHEED would be so foolish to betray India at the expenses of China. However, the common people of Maldives will not substitue India at any cost…

  2. randheli says:

    Dr.Waheed will be a national hero if he accomplish that. I think he will. Agreement really is one-sided and much of corruption that privatisation.

  3. Aisha says:

    Dr Waheed will do anything for his power . Otherwise he did not assist oppositions to topple an elected president. We Maldivians are currently facing many problems, government does not have sufficient money to pay salaries on other hand , for the pressure from his own coalitions Waheed is going to terminate GMR agreement , Maldivians will suffer long and i think most Maldivians will hesitate to visit India in future

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