The Straits Times
Published on Dec 03, 2012

India warns Maldives it might freeze aid over airport deal row


NEW DELHI (AFP) - India warned its neighbour the Maldives on Monday that it might freeze US$25 million (S$30.5 million) annual aid to the country amid anger over the cancellation of an airport contract for an Indian firm.

Last week, the new Maldives government gave five days to Indian infrastructure company GMR to leave after prematurely ending a 25-year management lease signed for the archipelago's main international airport.

The decision angered New Delhi and raised concerns about the investor climate at a time when the Maldives is seeking foreign financing for tourism projects after a year of political turmoil.

"We are not happy with the way Maldives cancelled the GMR airport deal.