Companies & Sectors
Maldives decides to scrap GMR contract, India reacts sharply

The $500-million Male airport project, awarded to GMR Group was hanging in balance ever since the regime change in Maldives earlier this year

 
Male/New Delhi: In a sudden and unilateral action, Maldives on Tuesday decided to scrap the $500 million contract given to GMR Group for developing Male Airport, evoking a sharp reaction from India which said it sends a "very negative signal" to foreign investors, reports PTI.
 
The Maldives Cabinet in a meeting on Tuesday decided to terminate the contract, Maldivian President's Press Secretary Masood Imad told PTI from Male.
 
In a statement, the Maldivian government said the decision to terminate the Concession Agreement signed on 28 June 2010, between GMR-MAHB consortium, Maldives Airports Company Ltd and the government was based on a paper presented by the Attorney General's office prepared after a "thorough research done for the past nine months by a Cabinet Committee".
 
The paper is based on "technical, fiscal and economic issues" and also includes the legal advice of lawyers from the UK and Singapore regarding the agreement which was "legally invalid, and impossible to further continue".
 
The Attorney General's office will initiate arbitration proceedings against GMR Male International Airport Ltd (GMIAL), the Cabinet decided, the statement said.
 
The $500-million project was hanging in balance ever since the regime change in Maldives earlier this year. The GMR group had won the contract during the regime of former President Mohamed Nasheed.
 
Some coalition partners of the current regime headed by Mohamed Waheed had also held a rally against GMR on 3rd November.
 
The airport contract was awarded to GMR through a 10-month long global competitive bidding process run by the then Maldivian government headed by Nasheed.
 
In New Delhi, the External Affairs Ministry came out with a strong reaction saying the decision was taken without due consultations.
 
India also asked Maldives to ensure Indian interests and security of Indian nationals in the Indian Ocean island country are "fully protected". .
 
"The decision to terminate the contract with GMR without due consultation with the company or efforts at arbitration provided for under the agreement sends a very negative signal to foreign investors and the international community", MEA spokesperson said.
 
India, he said, expected that Maldives "would fulfil all legal processes and requirements in accordance with the relevant contracts and agreement it has concluded with GMR in this regard".
 
The government of India would continue to remain engaged with the government of Maldives on this issue, he added.
 
The GMR Group termed the Maldivian government's decision as "unilateral and completely irrational".
 
"In a unilateral and completely irrational move the Government of Maldives has today issued a notice to the GMR Male International Airport Ltd (GMIAL) intending to take over the possession and control of the Ibrahim Nassir International Airport (INIA) under the pretext that the agreement is void," it said in a statement.
 
"This unlawful and premature notice on the pretext that the Concession Agreement is void is completely devoid of any locus standi and is therefore being challenged by the company before the competent forums," it said.
 
The company said it disputes the contention that the Concession Agreement is void, and added that it has taken all measures to continue operations at the INIA.
 
"We are therefore taking all measures to ensure the safety of our employees and safeguard our assets. We are confident that the stand of the company will be vindicated in every way," the statement said.
 
Nearly eight months after the regime change in Maldives, some Indian companies present there, including GMR, are blaming political interference for creating "undue challenges" for them.
 

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Ambit Capital, Edelweiss, JM Financial and Motilal Oswal Securities pay $1.8 million to settle SEC charges

Ambit Capital, Edelweiss Financial Services, JM Financial and Motilal Oswal Securities were charged for providing brokerage services to institutional investors in the US without being registered with the SEC as required under the federal securities laws

 
New York: US Securities and Exchange Commission (SEC) charged four Indian brokerages -- Ambit Capital Pvt Ltd, Edelweiss Financial Services Ltd, JM Financial Institutional Securities Pvt Ltd and Motilal Oswal Securities Ltd -- for violating registration rules and they have agreed to pay over $1.8 million to settle the charges, reports PTI.
 
The officials of the brokerages could not be immediately contacted.
 
In a statement, the SEC said it has charged Ambit Capital, Edelweiss Financial Services, JM Financial and Motilal Oswal Securities.
 
They were charged for "for providing brokerage services to institutional investors in the US without being registered with the SEC as required under the federal securities laws," the statement said.
 
Together, the four firms have "agreed to pay more than $1.8 million combined to settle the SEC's charges".
 
According to the regulator, these entities engaged with US investors despite being unregistered broker-dealers, in ways such as sponsored conferences in the US, among others.
 
"In their respective settlements, the firms agreed to be censured while neither admitting nor denying the SEC's charges.
 
"Ambit agreed to pay disgorgement and prejudgment interest totaling $30,910. Edelweiss agreed to pay $568,347. JM Financial agreed to pay $443,545 and Motilal agreed to pay $821,594," the statement said.
 

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COMMENTS

R Balakrishnan

4 years ago

why should the shareholders bear the financial impact? Directors should be held responsible. This is serious breach of trust

HC raps Maharashtra government for not taking action on bogus ration cards

The Court had asked the state government to give a district-wise break up of fake ration cards and inform what action it proposed to take against errant officials

 
Mumbai: The Bombay High Court has asked Maharashtra government to submit an action taken report against the officers responsible for issuing bogus ration cards on 11th December failing which Secretary of Food and Civil Supply should remain present on that day, reports PTI.
 
As the Government sought time to provide the required information, Justices AM Khanvilkar and Mridula Bhatkar pulled up the State authorities, saying sufficient time had been given to them.
 
"Are you going to wait till District Collectors file their responses?," they asked.
 
Taking a serious view of existence of bogus ration cards in Maharashtra, the HC had on last hearing asked the Government to proceed against officers responsible for the illegal practice failing which it threatened to order a top officer to take action in a time-bound manner.
 
The Court had asked the Government to give a district-wise break up of fake ration cards and inform what action it proposed to take against errant officials.
 
As the Government failed to provide such information today, the Judges were angry and asked the State to file a report on next date of hearing (11th December).
 
The HC was hearing a public interest litigation (PIL) filed by Jayprakash Unecha alleging that hundreds of bogus ration cards were in existence in Pune and other parts of the State.
 
Earlier, the State had disclosed that there were altogether 11 lakh bogus ration cards in circulation. Reacting to this, the Judges noted that the magnitude of the fraud was quite enormous.
 
Hearing another PIL, the HC had earlier told the Chief Secretary to file an affidavit giving details about mechanism it would adopt to prevent issue of bogus cards.
 
The second PIL, filed by LB Shaikh, an associate of anti-corruption crusader Anna Hazare, had alleged that the bogus ration card racket was to the tune of Rs25,000 crore.
 
The petitioner had pointed out that one of the methods used in this corrupt practice, is to continue the ration card of a person even after his death and purchase commodities in his name at cheaper rates from the public distribution system (PDS) and sell them at a premium in the open market.
 
"As the (Food and Civil Supply) department has no machinery to check the accuracy of information given by the applicant about his income, only evidence of residence is verified and thereafter the ration card is issued," a Government affidavit had contended.
 
Because of the procedure, it is difficult to fix responsibility on the staff for ineligible ration cards detected during drives. Despite this, instructions have been issued to District Collectors and the Controller of Rationing in Mumbai and Thane to take action against the staff for issuing bogus ration cards, it said.
 
The Government would ensure that penal action is taken by respective authorities in Mumbai and Thane against staff responsible for issuing ration cards to ineligible people, the affidavit contended.
 

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COMMENTS

Vaibhav Dhoka

4 years ago

The card system in India is a source of corrupt practice kept alive by government agencies may be Ration card/Adhar card or any other card.The recent control on number of LPG cylinders has brought out large number of bogus or dual registration.Immediately LPG dealers asked for increase in commission which they use to get manifold in selling cylinders in BLACK.This you can label RATION CARD SCAM.There are no dearth of scams in India.

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