ibnlive » India

Dec 04, 2012 at 09:23pm IST

Maldives firm on GMR contract cancellation, Indian pressure not working

New Delhi/Male: In the standoff between Maldives and India over the GMR managed airport, Male is adamant that the contract will not be revived, and that it will take control of the airport by December 8. Reacting to the development, the Indian government is now taking matters in its own hands.

Male has escalated the standoff with Delhi over GMR's $500 million airport project with President Waheed deciding to write to Prime Minister Manmohan Singh explaining why the airport deal was financially unviable for his government.

Effectively, the Maldives government will ignore the Singapore high court stay, and take over the international airport next week, even as GMR insists it will continue to manage operations.

"On the GMR issue we expressed our concern to your government. We made our stand clear that this would not affect our bilateral relationship and this is a business-to-business event," said Masood Imad.

The Ministry of External Affairs is treading cautiously. While batting for GMR, it has not become a party to this dispute. The government does not want to provoke a major backlash against Indian interests.

"It is a major setback. We have communicated this as a major setback, but we don't want a further spin off causing bitterness and irretrievable damage," said External Affairs Minister Salman Khurshid.

Maldives hopes the relationship with India won't take a hit but quietly, the Indian government is exercising diplomatic pressure on GMR's behalf. Sources say aid promised to Maldives will be released only if India is satisfied with the way Male handles the airport dispute.