Mon Oct 07 16:33:08 UTC 2024: ## India Extends Lifeline to Maldives Amidst Foreign Exchange Crisis, Resetting Bilateral Ties
**NEW DELHI:** India has stepped in to provide a financial lifeline to the Maldives, offering over ₹6,300 crore in support to help the island nation overcome its foreign exchange crisis. The announcement came during a landmark visit by Maldivian President Mohamed Muizzu to India, marking a significant reset in bilateral relations after a period of strain.
Prime Minister Narendra Modi, in a joint press conference with President Muizzu, highlighted India’s unwavering commitment to the Maldives as its “closest neighbor and a steadfast friend.” The support package includes a currency swap agreement of $400 million and ₹30 billion, along with a $100 million rollover of treasury bills by the State Bank of India.
Further solidifying economic ties, India and the Maldives initiated discussions for a free trade agreement and pledged to explore trade settlements in local currencies.
President Muizzu, who came to power last year on an “India Out” campaign, acknowledged India’s critical role in the Maldives’ socio-economic development, recognizing India’s support during times of need. “The Maldives will remain a true friend, committed to our shared vision of peace and development,” he stated.
The visit signifies a significant turnaround from the tense relations that marked the previous year. Ties had strained following the Maldivian government’s move to reduce its dependence on India and strengthen ties with China and Turkey. However, the recent period has seen a thaw in relations with back-to-back visits by the foreign ministers of both nations.
The bilateral meeting also saw a renewed focus on maritime security, with India pledging to bolster the Maldives’ capabilities in combating maritime challenges like piracy, illegal fishing, drug trafficking, and terrorism. This includes providing radar systems, defense platforms, and assistance in training and infrastructure development.
The visit culminated with the launch of the RuPay card in the Maldives, aiming to boost tourism and economic cooperation. India also inaugurated the new runway of Hanimaadhoo International Airport, built with an Indian line of credit, and handed over 700 housing units as part of ongoing development projects.
The meeting concluded with a shared commitment to foster stability and prosperity in the Indian Ocean region, with Prime Minister Modi accepting President Muizzu’s invitation to visit the Maldives in 2025 to mark the 60th anniversary of diplomatic ties.
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