The Maldives cabinet in a meeting today decided to terminate the contract and a notice to this effect was issued to GMR Group, Maldivian President's Press Secretary Masood Imad said in a statement.
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 November 3.
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.
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.