The just concluded four-day visit of Maldivian President Dr. Mohamed Muizzu has significantly bolstered the Maldives-India bilateral relations
At the invitation of Indian President Droupadi Murmu, the Maldivian President, Dr. Mohamed Muizzu, embarked on a state visit to India from October 6 to 10, 2024.
 
Accompanied by a senior delegation from the Maldives, this visit marked Muizzu first since attending Prime Minister Narendra Modi’s swearing-in ceremony in June 2024. Additionally, the two leaders met during the Dubai COP28 summit in December 2023.
 
During the visit, Dr. Muizzu discussed a spectrum of bilateral, regional, and global topics with PM Narendra Modi, External Affairs Minister Dr S. Jaishankar, and other critical Indian officials.
 
Importance of the visit 
 High-level diplomatic exchanges have been instrumental in shaping the bilateral ties between the two countries. The significance that India places on its relationship with the Maldives is underscored by President Dr. Muizzu’s trip to India following the visit of External Affairs Minister Dr Jaishankar to the Maldives.
 
The visit has taken place when the island nation is grappling with the risk of defaulting on debt. This comes as its foreign exchange reserves dwindled to US$440 million, barely covering the cost of imports for a month and a half.
 
After Moody downgraded the credit rating, a significant rise in the risk of defaults was noted. Since Dr Muizzu did not get any financial support from China during his visit to that country.
 
Moreover, the Maldives’ economy, heavily reliant on tourism, suffered a setback with a significant drop in Indian tourists by 50,000 over the last year due to strain in the bilateral ties after Dr. Muizzu assumed office.
 
This reduction led to an estimated financial loss of US$150 million. The recent visit to India is anticipated to rejuvenate the flow of tourists from India to the Maldives.
 
Within domestic politics, the partnership between Dr. Muizzu and his coalition ally, Abdulla Yameen, has started to experience strains. Yameen, who played a crucial role in Dr Muizzu’s ascent to the presidency by endorsing him during the presidential race despite being imprisoned for money laundering, is expected to be pardoned and released after the election.
 
However, Dr Muizzu did not meet these expectations, leading to Yameen, currently under house arrest, distancing himself from the Maldivian President and forming his political party, the People’s National Front.
 
From India’s perspective, the Maldives’ significance cannot be overstated, particularly within the ambit of India’s ‘SAGAR’ (Security and Growth for All in the Region) initiative and its ‘Neighbourhood First’ policy.’
 
The Maldives occupies a pivotal position in the Indian Ocean Region (IOR), rendering it an indispensable component of India’s strategic calculus, especially concerning national security. The Maldives’ geographical positioning and inherent maritime dynamics directly influence India's strategic depth and operational capabilities in the IOR.
 
Given these considerations, India must maintain and enhance its engagement with the Maldives, especially in times of crisis. A lapse or a perceived reduction in India’s commitment could create a vacuum. Such a vacuum can attract extra-regional powers, thereby altering the strategic balance in a manner possibly inimical to India’s interests.
 
Financial assistance 
 Following a meeting between PM Modi and the visiting Maldivian President, India issued a joint statement highlighting its close relationship with the island nation.
 
PM Modi called the visit a “new chapter” in ties and said India would always be there for the progress and prosperity of the Maldives. This policy positions India as a leading supporter of Male in times of crisis.
 
India reasserted its steadfast support for the Maldives in its developmental ambitions, extending US$ 400 million and a bilateral currency swap deal worth INR 30 billion.
 
These measures are crucial for addressing the Maldives’ financial hurdles. To ensure the Maldives’ long-term prosperity, both nations consented to undertake additional measures aimed at assisting the Maldives in overcoming its economic difficulties.
 
Earlier, India provided financial assistance, including by way of rolling over T-bills subscribed by SBI amounting to USD 100 million in May and September 2024 for a further period of one year that provided the much-needed financial cushion for Maldives in addressing its urgent financing needs.
 
Development partnership 
 India is the Maldives’ most significant development partner, supporting various community development and infrastructure projects since 1990.
 
India is also the Maldives' third-largest trading partner and the largest investor. Notably, direct cargo vessel services have been operational since 2020, and the introduction of Line of Credit Projects in 2021 has fostered deeper economic cooperation.
 
Furthermore, the implementation of visa-free entry for Indian business purposes in 2022 and the signing of a Memorandum of Understanding on duty-free tuna exports to India in the same year has strengthened trade ties between the two nations.
 
India’s development assistance in the Maldives can be broadly divided into large and high-impact community development projects and infrastructure projects.
 
These initiatives encompass hospitals, educational institutions, training facilities for security forces, water and sanitation systems, roads and land reclamation projects, stadiums, and social housing initiatives.
 
India-Maldives relations 
 Despite differences in size, resources, and economic power, India and the Maldives recognize each other’s strategic value as amicable neighbours. India has been acknowledged as a pivotal player in the Maldivian strategic context, having been the primary security source.
 
India’s swift response to events like the 1988 coup attempt, the Tsunami in 2004, and the water crisis in 2014 has deepened trust and solidified their warm bilateral ties.
 
In turn, the Maldives has consistently upheld its ‘India First’ policy, demonstrating a reliable partnership and underlining its position as a friendly neighbor to India, especially considering its strategic placement along India’s Western Coast.
 
This dedication was confirmed during numerous high-profile visits and reiterated in the most recent one. Contrary to the previous engagements, the dynamics between the two nations have significantly shifted since Dr Muizzu assumed office in November 2023.
 
This period also saw tensions flare up with India following disparaging remarks about PM Modi by three officials from the Maldives.
 
Furthermore, Dr Muizzu ordered India to recall approximately 80 of its troops stationed in the Maldives. His government also decided against renewing a hydrographic survey pact with India. Adding to the strain was permission granted to a Chinese research vessel, Xiang Yang Hong 3, to dock in the Maldives in February 2024.
 
However, the recent reconciliatory measures initiated by the Maldives and India’s positive response to that have improved the bilateral relationship. Since these developments, Dr Muizzu has made a noticeable effort to repair and enhance ties with India.
 
The relationship has seen positive changes, with the Maldivian President openly recognizing India as a “crucial ally and an invaluable partner” to the Maldives. His acknowledgment of India’s supportive role during times of need suggests a shift towards a more constructive and engaging bilateral relationship.
 
Conclusion
 The visit has significantly bolstered the Maldives-India bilateral relations further. Despite previous tensions and economic challenges faced by the Maldives, the visit underscored India’s commitment to its ‘Neighbourhood First’ policy and the strategic importance of Maldivian ties within India’s broader regional objectives.
 
The agreements reached during this visit demonstrate a forward-looking approach to addressing immediate financial concerns and ensuring long-term prosperity and security for both nations.
 
***The writer is a Research Fellow at MP-IDSA; views expressed in this article are personal