The move by the Maldives to terminate GMR Infrastructure’s 25-year contract to own and operate the Male International Airport is a “totally economic decision” that is crucial to its survival, according to Ahmed Adeeb Abdul Gafoor, Minister of Tourism, Arts and Culture of the Maldives.

In a telephone interview to The Hindu from Male, Mr. Gafoor said: “The terms of the contract are not positive. We believe that this airport is a strategic asset for the government, and we cannot accept a situation where we have to pay someone to run it.”

Holding that there was no concession agreement in the world with a $25 Airport Development Charge, he said tourism was growing and the government would have to pay GMR for every extra tourist arriving in Male. “This year, we have paid them $7 million and with tourist arrivals growing, next year we may have to pay them $8 million. This is not sustainable.”

A million tourists visited the Maldives this year, and Mr. Gafoor expects the number to go up to five million in the 25 years that the GMR concession will run. Explaining the context of the termination, he said privatisation of the only international airport in the country ought to have been done with Parliament’s approval instead of being an executive decision. The airport had to be accessible and cheap for airlines as it was critical for tourism, the mainstay of the nation’s economy.

Terming the contract “lopsided,” Mr. Gafoor said it gave revenues only to the investor (GMR) and not to the government. “This deal is similar to the Delhi…

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