India Maldives Relations: On the one hand, Maldives is going through economic difficulties. India has extended its subscription of government treasury bills worth $50 million for one year, giving emergency financial assistance to Maldives. This is the second time this year that India has offered such assistance to Maldives.
This step has been taken at a time when relations between the two countries have been thawing. Last year, Maldives President Mohammad Muizzu came to power by running an “India Out” campaign and demanded the withdrawal of more than 85 military personnel deployed in the country to operate three aircraft from New Delhi.
Subscribed for one year on request of Maldives government
The Indian High Commission said in a statement that the State Bank of India (SBI) has subscribed to the Maldives government’s treasury bills worth $50 million for another year on completion of the previous subscription. In the month of May this year, SBI had subscribed to treasury bills worth $50 million under the old system on the request of the Maldives government. These subscriptions have been made as “emergency financial assistance” on the specific request of the Maldives government.
India came to Maldives’ aid in its hour of need
The High Commission said that India has supported Maldives in times of need and the ongoing subscription of Treasury Bills, as well as the Indian government’s decision earlier this year to extend the special quota for export of essential commodities to Maldives by another year, reflects India’s continued support to the government and people of Maldives.
India is running under this policy
The Indian side also described Maldives as a major maritime neighbour and an important partner under the “Neighbourhood First” policy.
Maldives Tourism Minister expressed gratitude
Meanwhile, Maldives Tourism Minister Ahmed Adeeb in a post on X expressed his gratitude to the Indian government for extending “significant budgetary support” with the rollover of $50 million worth of treasury bills. Adeeb said that this strengthens the deep ties between our countries and strengthens our path towards economic stability and growth.
The previous government had also taken a loan
The Maldives is currently grappling with a severe economic downturn, with its revenues and foreign exchange reserves affected by the COVID-19 pandemic and the fallout from the Russia-Ukraine conflict. The previous government led by Ibrahim Solih borrowed from private lenders and India to deal with these issues, and the Maldives’ total debt rose to around $8 billion in 2023.
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