Tuesday
16th Apr 2024
Dhivehi Edition
Finance Minister Ibrahim Ameer. Photo: TMJ
The councils in the islands selected for the hospital project, for which the government acquired MVR 750 million in loans from India’s Exim Bank, have expressed their concerns regarding the lack of progress.
According to a leaked letter signed by Finance Minister Ameer, addressed to Exim Bank in India, Maldives hoped to acquire financing of USD 48.65 million which was estimated to cover 85 percent of the total cost for the hospital project. This is MVR 750 million. The letter stated that the project is estimated to cost a total of USD 57 million.
Under the project, hospitals are to be built in HA. Dhidhdhoo, R. Alifushi, Dh. Kudahuvadhoo and GA. VIlingili. However, the councils in these islands have verified that no work was being done to build hospitals in their islands.
President of HA. Dhidhdhoo Council, Abdulla Rasheed told TMJ that it had been four years since land was assigned and set aside for the project, however, no construction work has begun to erect the building. He said that after listing for bids on three separate occasions, the project had been contracted to an Indian Company.
Likewise, land was allocated for the project, at R. Alifushi, Dh. Kudahuvadhoo and GA. VIlingili, years ago and not a brick has been moved to build a hospital on the land.
Telecommunications Consultants India Limited (TCIL), the company tasked with the completion of the hospitals project, had said that the hospitals were to be prefabricated, light and medium duty hospitals.
Hospital Loan Breakdown Figures:
- Loan Amount: USD 48.65 Million
- Interest: LIBOR (6 months) and 325 bpa per annum
- Commitment Fee: 0.5 percent
- Management Fee: 0.5 percent
- Grace Period: 3 years
- Maturity Period: 15 Years
The state is set to commence repayment in 2026 for the loan acquired earlier this year and will have to pay it off by the year 2041.
Upon the addition of LIBOR and 325 bpa, the total interest rate comes to 7 percent, which is generally considered to be a higher interest rate. The usual interest rates for concessional loans such as this ranges between 3 percent and 4 percent.
Accounting the interest rates, at the time of full repayment, the state would have paid USD 30 million as interest which constitutes to 462 million in Maldivian Rufiyaa.
According to the agreed-upon terms, India is to acquire 85 percent of the materials and labor required for the completion of the project.
Upon the addition of LIBOR and 325 bpa, the total interest rate comes to 7 percent, which is generally considered to be a higher interest rate. The usual interest rates for concessional loans such as this ranges between 3 percent and 4 percent.
Accounting the interest rates, at the time of full repayment, the state would have paid USD 30 million as interest which constitutes to 462 million in Maldivian Rufiyaa.
According to the agreed-upon terms, India is to acquire 85 percent of the materials and labor required for the completion of the project.