India and the Maldives are currently in talks to negotiate a Free Trade Agreement (FTA) and an investment treaty aimed at deepening their economic relationship. According to Foreign Secretary Vikram Misri, the discussions also cover new cooperation areas such as renewable energy and fisheries. These updates come ahead of Prime Minister Narendra Modi’s scheduled visit to the Maldives on July 25.
India Among Maldives’ Top Trading Partners
Foreign Secretary Misri highlighted India’s strong economic engagement with the Maldives. Bilateral trade between the two nations stands at nearly $500 million, with Indian investors already active in key sectors like tourism. Misri emphasized that the ongoing discussions are intended to further expand this engagement and explore new sectors for collaboration.
Development Partnership and Infrastructure Projects
India continues to be a traditional development partner for the Maldives, supporting various initiatives through concessional lines of credit, grants, and buyer’s credit. The flagship Greater Male Connectivity Project, which links four islands, is expected to significantly transform infrastructure in the region. Other projects in progress include roadways, airport development, fisheries processing units, and social housing based on Maldivian priorities.
Financial Assistance and Currency Support
India has also extended substantial financial support to the Maldives, including a $400 million and ₹30 billion twin currency swap arrangement during President Mohamed Muizzu’s visit to India. The State Bank of India (SBI) has continued to invest in Maldivian treasury bills, reinforcing India’s economic support.
Capacity-Building and Defence Cooperation
The bilateral relationship also includes major capacity-building efforts, with India offering scholarships and training to Maldivian professionals. In defence and maritime security, India supports the Maldives through regular training programs, joint naval exercises, and the provision of ships for Exclusive Economic Zone (EEZ) surveillance. Both countries also cooperate under the Colombo Security Conclave.
Focus on Comprehensive Strategic Partnership
Foreign Secretary Misri underlined the comprehensive and multifaceted nature of the India-Maldives relationship. He stated that the partnership has consistently received high-level attention and that the upcoming visit by Prime Minister Modi is expected to further strengthen these ties in line with India’s neighbourhood-first policy and MAHASAGAR vision for the Indian Ocean region.
Diplomatic Reset and Special Invitation
Relations between the two nations faced a brief strain in early 2024 due to derogatory comments made by Maldivian officials about Prime Minister Modi. However, Maldivian Foreign Minister Moosa Zameer later clarified that the comments did not reflect the government’s position and assured corrective measures were taken.
Prime Minister Modi’s visit to the Maldives will coincide with the country’s 60th Independence Day celebrations on July 26, where he has been invited as the ‘Guest of Honour.’ This visit, his third to the Maldives and the first during President Mohamed Muizzu’s tenure, also marks the 60th anniversary of diplomatic relations between the two countries.
