The North News
New Delhi, July 26
India has extended a Line of Credit (LoC) worth ₹4,850 crore (approximately USD 550 million) to the Maldives to support key infrastructure and development projects, as Prime Minister Narendra Modi held wide-ranging talks with Maldivian President Dr Mohamed Muizzu in Male on Friday. The announcement came during Prime Minister Modi’s official state visit to the island nation, where he was received with ceremonial honours at Republic Square and held bilateral discussions at the President’s Office in Male. The visit marks a significant milestone, coinciding with the 60th anniversary of the Maldives’ independence and the establishment of diplomatic relations between the two countries.
Prime Minister Modi expressed appreciation for the warm welcome and reiterated India’s commitment to the “Neighbourhood First” and Vision MAHASAGAR policies, which prioritise stronger ties and regional cooperation in the Indian Ocean.
Strengthening Strategic and Development Ties
The two leaders reaffirmed the centuries-old bonds between their nations and took stock of progress under the India-Maldives Joint Vision for a Comprehensive Economic and Maritime Security Partnership, which was agreed during President Muizzu’s visit to India in October 2024.
President Muizzu acknowledged India’s role as the “First Responder” in times of Maldivian crisis — from health emergencies to natural disasters. Both sides discussed avenues for deeper collaboration in climate action, capacity building, defence, maritime security, infrastructure, and health.
Key Financial and Trade Agreements
A major outcome of the visit was the signing of the new ₹4,850 crore Line of Credit, aimed at supporting Maldivian infrastructure and development initiatives. The two nations also exchanged an Amendatory Agreement that reduces Maldives’ annual debt repayment burden by 40%, lowering payments from USD 51 million to USD 29 million.
Additionally, India and Maldives finalised the Terms of Reference for a proposed Free Trade Agreement (FTA) and discussed progress toward a Bilateral Investment Treaty, opening doors for deeper economic engagement.
Eight Key MoUs and Agreements Exchanged
The leaders witnessed the exchange of eight key agreements:
- Finalised Terms of Reference for the India–Maldives FTA.
- MoU on Fisheries and Aquaculture Cooperation.
- Collaboration on meteorology and climate services between Indian and Maldivian agencies.
- MoU on Digital Public Infrastructure, allowing Maldives to adopt India’s successful large-scale digital tools.
- Recognition of the Indian Pharmacopoeia (IP) in Maldives.
- Network-to-Network agreement between India’s NPCI and Maldives’ MMA for the implementation of UPI digital payments.
- Amendment to LoC terms, reducing the Maldivian debt burden.
- Continued cooperation in defence and maritime security, including work under the Colombo Security Conclave.
Major Inaugurations and Handovers
The visit saw several infrastructure inaugurations and symbolic handovers, including:
- 3,300 social housing units in Hulhumale under India’s Buyer’s Credit facility.
- Roads and drainage system in Addu City.
- Six High-Impact Community Development Projects across various islands.
- 72 vehicles and equipment for Maldivian defence and immigration authorities.
- Two BHISHM Health Cubes, equipped to treat 200 casualties and sustain six medical staff for 72 hours in emergencies.
- Inauguration of the new Maldivian Ministry of Defence building in Male.
Climate Action and Symbolic Gestures
In a nod to shared environmental goals, the two leaders planted mango saplings as part of India’s “Ek Pedh Maa Ke Naam” campaign and Maldives’ “Pledge of 5 Million Tree Plantation” initiative.
Global South Priorities and Terror Condemnation
As partners in the Global South, both countries pledged continued cooperation on climate change, renewable energy, disaster preparedness, and sustainable development.
Prime Minister Modi thanked President Muizzu for strongly condemning the recent terror attack in Pahalgam and for standing in solidarity with India in the fight against terrorism.
Looking Ahead
The leaders expressed confidence that their renewed cooperation would deliver tangible benefits to citizens of both nations. Prime Minister Modi reiterated that India would continue to support Maldives in accordance with its needs and priorities, contributing to the peace and prosperity of the Indian Ocean region.
