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Watchdog to lapdog: Independent Institutions in Need of Reform

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On 17th November 2018 Ibrahim Mohamed Solih from Lh.Hinnavaru swore in as the 7th President of the Republic of Maldives. This was marked with promises of transparency and good governance. Shortly afterwards, President Solih assured to the public that his administration will have a “zero tolerance” for corruption and soon after the President’s Office launched a whistleblower portal. Though it was criticized for rerouting potential cases of corruption from going to the actual Anti-Corruption Commission of Maldives, the portal remains open.

Into the 2nd year of his Presidency, allegations of massive corruption has been floating around with ruling party parliamentarians accusing government ministers of embezzling state funds while the opposition members have accused senior government officials of illicitly enriching themselves. One such notable case which is yet to be investigated is the peripatetic Foreign Affairs Minister Abdulla Shahid who used state funds to purchase tickets from Maldives to the United Kingdom and back, which he reimbursed to the state only after it was reported to the ACC.

A more recent case of corruption tolerated by Solih’s administration and its anti-corruption watchdog is the procurement of ventilators in the fight against the COVID 19 pandemic. The health ministry fast tracked and gave the procurement order for 75 ventilators with half of the payment paid upfront to a Dubai company which was later found to be a paper company without even a trade license. This  blunder however pales in comparison to the amount of state funds lost outside of courts and arbitration to companies with close ties to the ruling party as “compensation”.

Till date more than 2.4 billion rufiyaa has been handed over to these companies  for damages incurred to them after the current government dissolved PSIP projects awarded to them. But, if we are to taking into account the Seaplane Terminal Corruption scandal, more than 4 billion rufiyaa from state coffers has been allegedly embezzled which begs the question, where is the Anti-Corruption Commission of Maldives?.

Not only has the ACC failed to take the initiative to investigate these cases, as of date not a single case has been sent for prosecution. The Anti-Corruption watchdog currently headed by the former executive director of Transparency Maldives Mariyam Shiuna who is a close associate of the President’s Policy Secretary Mariyam Shauna who herself is allegedly involved in the Seaplane Terminal corruption scandal, has repeatedly failed to execute her duties as the head of the institution dedicated to curbing corruption within the government.

But the trail of corruption and influence doesn’t just end at the Anti-Corruption Commission. Rapid reform is needed for all state institutions including the current Judicial Watchdog which has also been experiencing the same symptoms as the ACC, prominent ruling party activists being appointed to key positions within the government. The appointment of MP Hisaan Hussein to the Judicial Service Commission (JSC) who is the long time lawyer and close friend of the ruling party president Mohamed Nasheed, has been met with much criticism by both the public and the opposition party.

Hisaan’s appointment to the Judicial Service Commission (JSC) was soon marked by the suspension of the Chief Justice of the Criminal Court Judge Hailam, who later released a statement alleging that senior officials within the government including the Presidents Chief of Staff who had contacted him and threatened him in a bid to ensure that the former President Abdulla Yameen’s case which he presided over would end with a conviction. A Chief Justice accusing the state of interfering in the judicial process is a serious matter which needs investigating. But till date, no government institution has even addressed nor acknowledged the accusations.

 This trend of this government acting ignorant to public outcry and accusations of corruption only helps pave way for corruption and an increasing tolerance to bureaucratic blunders and incompetence from senior officials. And with the ruling party holding a super majority over the parliament, the appointment of ruling party activists to independent bodies continue to fuel the degradation of public trust in the government and all its institutions.

Independent Institutions such as the ACC and the JSC are meant to be operated outside of the influence of the Parliament and the Executive Office. But when these intuitions come under the direct influence of the ruling party, it not only paves way for corruption and injustice, it decays the democratic  system that the young nation has so fought so valiantly to achieve. State institutions which are to act as watchdogs should remain independent and vigilant to all wrong doings to ensure good governance and transparency.

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Potential of Waqf to Finance the Social Development Projects.

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Ministry of Islamic Affairs is the executive body responsible in Maldives to carry out religious tasks and waqf is also regulated by the Ministry of Islamic Affairs. The concept of immovable waqf is not common in Male’ as land is a scarce resource and further, the Land Act prohibits land in Male’, to be declared as waqf. In this regard, it is observed that Section 37 of the Land Act states: (a) any land in the Maldives or any fixed assets on such a land can be declared to be a religious endowment only if declaring it to be a religious endowment does not conflict with government policies on land use for the particular island and this shall further be subjected to the attainment of a written approval from the Ministry of Home Affairs, Housing and Environment; (b) land or fixed assets on a land in Male’ cannot be declared as religious endowments. However, it is imperative to note that waqf is an Islamic social finance institution and a tool that could be utilized for the social developments of islands without relying on the government budget to support such causes.

What is Waqf?

Waqf (Islamic endowment) is an Islamic social financial institution which is also considered as a redistributive institution. Though the term “waqf” is not found in Quran, Muslim jurists have derived its legitimacy from various sources of Islamic law including Quran and Sunnah. There are two kinds of waqf: immovable waqf and movable waqf which is cash waqf that has been approved by the Islamic scholars.  Irrevocability, perpetuity and inalienability are essential conditions to create a waqf. The purpose in which waqf has been utilized is not limited only to religious matters; but it can be used for any purpose which is beneficial to the society that does not contradict with the tenets of Islamic law. Waqf is known as a sadaqat jariyah (on-going charity) while sadaqat is known as a one-time charity that could be given to any type of beneficiary identified by the giver at any time. Waqf is also different from zakat. Zakat is the third pillar of Islam which is compulsory for all eligible Muslims to pay to the legal beneficiaries mentioned in Quran. As such, zakat is a due right on specific items of assets/properties, in specific percentages with consideration of the passage of a year (hawl) and the satisfaction of nisab.

Awqaf Sector of Maldives

There are only two cash waqf funds established by the Ministry of Islamic Affairs. They are the Religious Awareness Waqf Fund and the Mosque Waqf fund. These two funds are maintained in a Public Trust Account formed under the Public Finance Act 2006. There is a Trust Committee set up to specifically deal with the funds and the ultimate supervisor of the fund in the Ministry of Finance & Treasury. Dharul Eeman Waqf project is an innovative waqf project successfully implemented by the Ministry of Islamic Affairs where the Ministry has developed a building on a land and has dedicated all the revenue received from renting of the building to Mosque waqf fund. By doing this, the Ministry intends to have enough financial capability to renovate mosques every year without waiting the government to approve funding for the purpose. Due to weak governance, though the project faced issued in implementing it as anticipated, it is hoped that the Ministry would be able to resolve governance issued and implement the project in a sustainable manner.

 Sustainable Waqf Models for Island Councils to finance Social Development Projects

Island councils can play a leading role in reviving waqf in the country for social development activities. Below are some successful ways in which other countries in the world has implemented waqf for the purpose and the same approach could be customized and replicated in Maldives.

  • Waqf Share Scheme (successfully practiced in Malaysia, Indonesia, Kuwait and the UK): In waqf share scheme, any specified institutions appointed by the government may establish this scheme and become the mutawalli (trustee). The appointed trustee will issue waqf shares in different values and sell the shares to donors for a specific project. The donors can buy the shares according to their affordability. The donors will receive cash waqf certificates as evidence of purchasing the waqf shares of the specified amount for the specified project. The amount collected from the sale of waqf shares will be managed by the trustee in terms of investment of the funds. The revenue generated from the investment will be used for financing the specified projects.
  • Waqf Share Scheme (successfully practiced in Singapore): In this scheme, Muslim employees’ salaries are deducted through the Central Provident Fund (CPF) Board, i.e. Singapore’s national social security organisation. Monthly contributions of between USD$1 and USD$7 are made by Muslim employees. The amount of deduction depends on the Muslim employee’s monthly gross salary. The salaries of the Muslim employees are automatically deducted through an automatic check-off system whereby the salary is deducted by their employer and channelled through the CPF with Majlis Ugama Islam Singapore (MUIS) as the collecting agent. The collected amount is to finance charitable purposes such as building and maintaining mosques, funding educational programmes and building da’wah centres.
  • Corporate Waqf Scheme (successfully practiced in Malaysia, Turkey, India, Pakistan and Bangladesh): In this scheme, first founder, either a private or public corporation known as the mother corporation/main founder, will establish an associated waqf institution as the trustee. The main founder will ask all its subsidiaries to contribute part of their profits or dividends to the corporate waqf on a regular basis, besides calling other donors such as individuals, companies and institutions to contribute cash waqf to this associated waqf institution. The associated waqf institution, in its role as the trustee, will manage and invest the accumulated cash waqf from the different contributors. The revenue generated is then channelled to the specific project after operational expenses have been deducted
  • Waqf Takaful Model (successfully practiced in in South Africa and Pakistan): In this model, Takaful operator donates a seed fund to establish a Waqf fund for the product/policy. On a monthly basis, premium contributions made by participants are split into two portions – a portion for tabarru’ contribution to Waqf fund and a portion to participants’ risk account. The appropriation (based on percentage of premium contributed) shall be decided and agreed upfront between the takaful operator and participants. Any takaful claims will only be paid/deducted from the participants’ risk account while any surpluses will be credited back into the same account. Both Waqf fund and participants’ risk account will be invested in Shariah compliant instruments to generate returns where the return from the participants’ risk accounts will be credited back to the account. Returns from the waqf fund however, will be channelled to the waqf beneficiaries as approved by the takaful operator’s Shariah Committee. In the event of death, the deceased’s beneficiaries will be compensated with the takaful benefit from the participants’ risk account. No further amount is paid on behalf of the deceased to the Waqf fund (hence, the contribution to waqf fund is limited to the amount contributed while the participant is alive).

 Conclusion

Apart from the above described waqf models, there are many other successful waqf models practiced in the world as well. The other successful waqf models that could be considered are: cash Waqf-linked Sukuk; Cash Waqf Deposit Product; MyWakaf Initiative; Waqf Fund Model for Education; Waqf Unit Trust Fund; and Waqf Using Blockchain Technology. It is anticipated that the stakeholders of waqf in Maldives will try to revive waqf in the country by adopting the contemporary application of it.

Dr. Aishath Muneeza is an Associate Professor at the International Center for Education in Islamic Finance. 

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Digitally inclusive society starts with connectivity.

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The term digital inclusion or inclusivity is a relatively new concept that came into existence as a result of the rapid growth and widespread adoption of information and communications technology (ICT) in our society. The Institute of Museum and Library Services of the United States defines digital inclusion as “the ability of individuals and groups to access and use the information and communications technologies.”

The COVID-19 pandemic has accelerated the adoption of new technologies in the Maldives, with telehealth, online education, and various other services. Technological change means that digital skills are increasingly important for connecting with others, accessing information and services, and meeting the changing demands of the workplace and economy.

Communication and internet access is the backbone of any digital inclusive society and already Maldives has a widely available mobile network with 2G, 3G and 4G throughout the country.

DIGITAL ACCESSIBILITY

From the latest statistics from the Maldives National Bureau of Statistics, Maldives has a population of 568,362 (forecasted) and 717,708 mobile subscribers distributed amongst two Mobile network operators. Internet subscription is at 315,694 users with three internet service providers in the Maldives.

Source: International Telecommunication Union ( ITU ) World Telecommunication/ICT Indicators Database

According to the World Bank latest release of Maldives Development Update: A Digital Dawn ranks the Maldives ahead of other countries in South Asia when it comes to digital connectivity. According to recent figures published by International Telecommunication Union ( ITU ), World Telecommunication/ICT Indicators Database Maldives internet usage is 63.2% compared to the population. The Maldives is also ahead when it comes to mobile phone usage, compared to the average of South Asian countries of 85%, with 140.9% connection compared to the population.

Maldives communication network is connected to both Sri Lanka and India via submarine cable. This year also saw Dhiraagu and Ooredoo collaborate with Huawei and Dialog AXIATA to build the Maldives-Sri Lanka Cable, connecting Colombo to Hulhumalé at a cost of USD 22 million. Also, Dhiraagu and Ooredoo have been running a national submarine cable network from North to South to connect their main hubs.

Maldives-Sri Lanka Cable (MSC) landing event Photo: Ooredoo/Facebook

The national submarine cable system has assisted these telecommunication companies to change networks reliance on radio technology for their national network. Thus, further improving core networks connectivity and bandwidth, giving freedom to provide more services and solutions. This also helped these companies to roll out 4G services across the country and laid the foundation for the 5G mobile network role out with currently covering few areas in various cities.

However, with these improvements in the past 10 years to the communication network still, there are large differences when it comes to the adoption of digital technology based on demographics, location and education. According to preliminary estimates from the 2019 Household Income and Expenditure Survey (HIES), 83 per cent of households in the capital city of Malé have access to fixed broadband services, while only 51 per cent of households within the atoll. There are still islands without fixed broadband service, and they rely mostly on mobile for their broadband service. This digital divide is more exposed when we dive into broadband speeds, as Malé City residents enjoy faster connectivity when compared to atolls (figures are twice the speed of atoll). 2016/2017 Demographic Health Survey shows that Maldivians with more than a secondary education are three times more likely to have used the Internet compared to those with no education.

Despite the transformative impact of technology on Maldivian society, there is still a digital divide between those who have access to technology and those who do not, giving rise to inequalities in access to opportunities, information, services, and goods. But unfortunately, those who are not engaging effectively with the digital world are at risk of being left behind.

COST OF TELECOMMUNICATION

Maldives has one of the highest telecommunication costs in the world, with two main operators functioning as a duopoly with little regulatory oversight from the Communication Authority of Maldives (CAM). Communication Authority of Maldives was established in 2016 under the Communications Authority of Maldives Act as a regulatory board for the telecommunication sector in the Maldives.

Rank Name Mobile Average price of 1GB (USD)
1 Bangladesh $0.34
2 Sri Lanka $0.38
3 Pakistan $0.59
4 Nepal $0.61
5 India $0.68
6 Bhutan $0.83
7 Maldives $3.24

Data extracted from cable.co.uk.

Sri Lanka and Bangladesh have one of the cheapest mobile data and amongst ten countries for the cheapest mobile data availability in the world. When the Maldives compares to the next most expensive country for mobile data in the region Bhutan, Maldivians pay 388% more than what a Bhutanese pays for a 1GB of mobile data.

As per the figures from the CAM website, there are 64,800 fixed broadband subscribers in the Maldives, from which most of the subscribers are concentrated to the Greater Male’ Area and Cities of Maldives. As per the Maldives Development Update: A Digital Dawn published by World Bank, the share of Maldivians with a fixed broadband Internet subscription is lower than the average for upper-middle-income countries and most Caribbean SIDS, the main reason for this is the high prices charged in the Maldives. ITU estimated at 2019 monthly price for the subscription of an entry-level fixed broadband plan is about 3.1 per cent of Maldives’ per capita income, which is way higher than the UN recommended target of 2 per cent.

Prices are extremely high relative to the quality of services that subscribers receive, data collected by cable.co.uk in January 2021, the average download speed in the Maldives was 5.88 megabytes per second (Mbps), behind India (13.46 Mbps) and Sri Lanka (20.73 Mbps) in the region. When we translate this into a simple logic, which means if you download a file which is 5GB in Sri Lanka, you will download it in 33 minutes in the Maldives, it will be almost 2 hours. When we are being left behind in this digital divide due to the unaffordability of internet service in the Maldives, many countries are looking at or implementing ultrafast broadband internet at speeds averaging over 100 Mbps.

GOVERNMENT FORCED PRICING

Maldivian government announced through the Ministry of Environment, Climate Change and Technology new pricing and packages after negotiating with the Internet Service Providers. At these discussions and negotiations by the government, Dhiraagu and Ooredoo took the centre stage, and for some unknown reason, the third ISP Raajje Online was left in the back seat.

This will definitely provide an opportunity for more bargaining powers to the duopoly of Dhiraagu and Ooredoo, which might be the reason for Twitter uproar with rumours that the government has negotiated not to welcome a new telecom service provider in the country for a couple of years, which was later rebuffed by the Ministry.

Package Speed(Mbps) Allowance(GB) Price(MVR)
5 30 250
15 100 500
25 200 700

The current changes to the pricing will benefit the subscribers of fixed broadband immensely and bringing down the prices by 28 to 30% compared to the current price and will be enforced from 1st July 2021. Even with the reduction in the price which is still above the region’s average and above UN recommended levels.

As a duopoly controlling the telecommunication in the Maldives, it gives unauthoritative powers to Dhiraagu and Ooredoo to play with the quality of service of the internet, with little regulatory oversight from the Communication Authority of Maldives. With current price changes management of ISPs’ will mitigate the loss of the revenue with cost management measures, this will affect the quality of service of the internet. As internet service providers Dhiraagu, Ooredoo and Raajje Online buys bandwidth, network access and other network services from companies who are Network Service Providers (NSP) from abroad with long term and short term agreed pricing and bandwidth.

Quality of Service (QoS) is a set of technologies that work on a network to guarantee to make sure internet speed or experience is not hindered and internet users are able to enjoy browsing, video and voice chat, streaming service etc. Internet Service Providers will be able to control outgoing traffic to international websites and location with speed restriction thus reducing the quality of service for internet users. One of the questions on your minds will be “Are internet service providers capable of doing this?”, the answer is simple “yes”, they can, and they do it even now to shape and prioritize the traffic. With forced pricing and packages ISP can reduce their international bandwidth to bring down the cost, leaving reduced bandwidth to be distributed amongst their customers.

Communication Authority of Maldives is the regulatory body for the telecommunication industry of Maldives, needs to be more active and vigilant on QoS of the internet.

Conclusion

Giving the authority to Internet Service Providers to set pricing doesn’t help any stakeholders and it isn’t perfect but neither are completely imposed restricted pricing or packages from the government. From a pricing point of it benefits the internet users but there is potential for degraded quality of service and reduction in investments for infrastructure in the long run.

Government should take steps from a regulatory point and also increase the competition to break the duopoly of Dhiraagu and Ooredoo to improve the quality of services, reduce the price in open market and infrastructure developments for communication and internet service in the whole country.

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Leaked documents show India refused to withdraw military personnel and helicopters from the Maldives even after their Visa’s expired.

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Allegations that Indian influence in the Maldives has been one of the most debated topics in the Maldives. Accusation that India has influenced the last Presidential Election and the current administration is a common topic for political debates. However, a series of documents has been leaked by a local news showing communication between the Maldives Foreign Ministry and the Indian High Commission during the previous administration. The documents show the Government of Maldives requesting the Indian High Commission to withdraw their Helicopter stationed in the Maldives. The documents cement the allegations by the public that India has been increasingly overstepping on the sovereignty of the Maldives.

Below is a timeline of the events, first published in Dhivehi language on “Dhiyares News”.

In a letter dated 22nd April 2018, the Government of Maldives informed the Indian High commission on its decision to return the Helicopter being operated from Addu city by the end of June 2018.  While the letter maintain diplomatic composure, based on the events that took place, it is evident that there was tension between the two parties.

A second letter was sent on 06th May 2018. In the second letter, the Government of Maldives informed the Indian High Commission that the agreement for the helicopter operated out of Laamu atoll had expired on 01st may 2018, and requested its withdrawal by the end of June 2018.

And on 10th June, an additional letter was sent to Indian High Commission. This letter acted as a reminder on the order to withdraw the Indian helicopters and their military personnel by the end of June 2018. It also requested the Indian High Commission to provide a schedule of withdrawal.

The Indian high Commission in Maldives replied with their own letter on 25th June 2018. In their letter, the Indian high Commission stated that Indian government would require “more time” to examine the order to withdraw by the Government of Maldives.

It also noted that the Visa for the Indian military personnel in the Maldives would expire on 30th June 2018, and requested their renewal.

The Government of Maldives replied to this with a  letter dated 27th June 2018, reiterating on the order to withdrawal and to provide a schedule of withdrawal.

Sovereignty at stake?

Based on what happened next, it is clear that the Indian High Commission did not withdraw their helicopters nor their military personnel. It is now a verified fact that the Indian military personnel illegally stationed themselves, against the wishes of then government without even a legal visa. However, with the change of administration, their visa’s and the helicopter agreements were promptly renewed.

The current administration and its President Ibrahim Mohamed Solih which has been marked by its close ties to India, acting as its “yes-man” since his election.

It is clear that India does not seem to view the Maldives as a sovereign nation, and is willing to go against the laws and constitutions of the Maldives and international conventions, to impose their people and influence in the Maldives.

This leak comes following weeks of online protest by locals against the growing Indian influence in the Maldives. Many have accused India of meddling with domestic elections and other issues, to increase their influence in the Maldives.  India’s seemingly unilateral decision to establish a consulate in the southernmost city of Addu has further fueled the allegations. The Hanimaadhoo, military planes, radar systems, helicopters, Police academy and military base near the capital has only exacerbated the situation.

This begs us the question, is our independence and sovereignty at stake?. Does the Maldives need to appeal to the International community that India just won’t remove their military personnel from the Maldives? Are we becoming the next Sikkim ?

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