India suggests economic support for Maldives following discussions to mend relations
Date
10/8/2024 5:24:15 AM
(MENAFN) India has increased its development assistance to the Maldives following talks between Prime Minister Narendra Modi and Maldivian President Mohamed Muizzu in New Delhi on Monday. This effort aims to mend the strained relations that have emerged as the Maldives has leaned closer to China. During their discussions, Modi announced a financial support package that includes a USD100 million rollover of treasury bills and a USD400 million currency swap agreement to assist the financially struggling Maldives.
Additionally, the leaders jointly inaugurated a new runway at Hanimaadhoo International Airport and Modi pledged to expedite the India-assisted Greater Male Connectivity Project, which seeks to enhance transportation links between key islands in the Maldives. Emphasizing India's commitment to the Maldives, Modi stated, “India is Maldives’ nearest neighbour and a close friend,” highlighting the Maldives' significance in India’s “neighbourhood first policy.”
Relations between India and the Maldives have been strained since Muizzu, who favors closer ties with China, won the presidency last year, defeating the India-friendly Ibrahim Mohamed Solih. Muizzu had previously pledged to remove Indian troops stationed in the Maldives for humanitarian assistance, leading to New Delhi replacing its military personnel with civilian experts in May.
Tensions escalated further when Maldivian officials criticized Modi for promoting the nearby Lakshadweep archipelago as a tourist destination, which locals perceived as an attempt to divert Indian tourists from the Maldives. This led to protests and calls for a tourism boycott from Indian celebrities, highlighting the Maldives' reliance on tourism for its economy. The situation worsened when Muizzu prioritized a visit to China over India earlier this year. However, a thaw in relations occurred after he attended Modi's swearing-in ceremony in June, prompting a reduction in anti-Indian sentiments and an increase in official communications as both countries faced the potential of an economic crisis in the Maldives.
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