Moving to stem the slide in ties ever since President Mohamed Muizzu came
to power on an anti-India election plank last year, India and Maldives Monday agreed
to transform the bilateral relationship to a “Comprehensive Economic and
Maritime Security Partnership”.
As Prime Minister Narendra Modi met President Muizzu
in New Delhi, India decided to extend support in the form of INR 30 billion and
USD 400 million as part of a bilateral currency swap agreement, instrumental in
tackling the ongoing financial challenges faced by the Maldives.
The two sides agreed to launch negotiations for a Free Trade Agreement and
signed five pacts including the currency swap agreement, training of judicial
officers, prevention of corruption, law enforcement training, sports and youth
affairs.
The two leaders also
launched the Rupay card in the Maldives, while India handed over 700 social
housing units and inaugurated a new runway at the Hanimaadhoo international
airport. After their bilateral talks, Muizzu said, “Maldives
will remain a friend committed to our shared vision of peace and development in
our countries and our region.” He invited Modi to visit the Maldives next year
to celebrate the 60th anniversary of diplomatic ties.
Modi described India as the “first responder” for Maldives in times of
crisis – from Covid pandemic to drinking water shortage. Calling the ties as
“age-old”, he said the Maldives is India’s “close neighbour” and “friendly
country”. As part of India’s “neighbourhood first policy” and the “SAGAR
(Security and Growth for All in the Region)” vision, he said India has
fulfilled its responsibilities as a neighbour.
On the economic help
for Maldives, Muizzu said, “I would like to thank Prime Minister Modi, the
government and people of India for the generous assistance and cooperation
extended to the Maldives over the years, including the recent budgetary support
in the form of rollover of the T (treasury) bills. I am thankful for the India government’s decision to provide support in
the form of 30 billion Indian rupees, in addition to the 400 million US dollar
bilateral currency swap agreement, which will be instrumental in addressing the
foreign exchange issues we are facing right now. Our discussions today
underscored a shared commitment to remain engaged on further measures that will
bolster the Maldives’ economic resilience and stability.”
On the FTA, Muizzu said, “We look forward to concluding the free trade
agreement with India, which will enable us to harness the full economic
potential between our countries and to increase Indian investments in both our
tourism and various sectors of development.” The economic assistance is significant since Maldives is looking at a
debt default as its foreign exchange reserves have dropped to $440m (£334m),
just enough for one-and-a-half months of imports.
On Monday, the joint statement titled “India and Maldives: A Vision for
Comprehensive Economic and Maritime Security Partnership”, said India and
Maldives share “common challenges in the Indian Ocean Region which have
multi-dimensional implications for the security and development of both the
countries. As natural partners, they
resolve to work together in advancing maritime and security cooperation for the
benefit of peoples of both India and Maldives as well as for the larger Indian
Ocean Region.”