In a significant diplomatic development, Maldives President Mohamed Muizzu and Indian Prime Minister Narendra Modi concluded a landmark agreement on October 7th, 2024, solidifying a comprehensive economic and maritime security partnership.
This agreement marks a notable shift in policy for President Muizzu, who campaigned on an "India Out" platform but has since recognized the strategic importance of close ties with India.
Initially, the Muizzu administration requested the withdrawal of Indian military personnel stationed in the Maldives for humanitarian and disaster relief operations. However, acknowledging the growing geopolitical complexities in the Indian Ocean region, the Maldives has reversed course.
The agreement allows India to deploy defence platforms in the archipelago and provides for enhanced surveillance and monitoring capabilities for the Maldivian National Defence Force (MNDF).
India will supply radar systems and other advanced equipment to bolster the MNDF's ability to safeguard its maritime borders, combat illegal fishing and piracy, and address other security threats.
This strategic partnership extends beyond defence cooperation. India has pledged continued financial support to the Maldives, including rolling over USD 100 million worth of T-bills and providing a USD 400 million currency swap agreement and INR 30 billion financial package.
This aid will be crucial in supporting the Maldives' economic recovery and financing vital development projects, including affordable housing and infrastructure improvements for ports and airports.
"India has always been a first responder during crises," President Muizzu acknowledged, referencing India's assistance during the 2014 water shortage in Malé and the COVID-19 pandemic.
Both nations are committed to enhancing maritime security cooperation to address common threats such as piracy, illegal fishing, drug trafficking, and terrorism.
India will assist in the timely completion of the MNDF 'Ekatha' harbor project at Uthuru Thila Falhu (UTF), a critical initiative to enhance Maldives' maritime security infrastructure. Further collaboration will include hydrography, disaster response, capacity building, and training programs for the MNDF.
The agreement also outlines plans for increased trade and investment. Discussions have begun on a Bilateral Free Trade Agreement (FTA) to streamline trade in goods and services.
The operationalization of local currency trade settlements will reduce reliance on foreign currencies and strengthen economic ties. Collaboration in agriculture and fisheries will focus on establishing an Agriculture Economic Zone and a fish processing facility.
Recognizing the importance of energy security, India and the Maldives will partner on renewable energy projects, including exploring Maldives' participation in India's "One Sun, One World, One Grid" initiative.
The agreement further encompasses strengthened political engagement with a planned Memorandum of Understanding to institutionalize cooperation between the two parliaments. India will also introduce its Unified Payments Interface (UPI) and other digital services in the Maldives.
Health cooperation remains a priority, with plans to establish India-Maldives Jan Aushadhi Kendras to provide affordable medicines. Collaboration will also extend to mental health services, drug rehabilitation programs, and medical evacuations.
This comprehensive partnership signals a new era in India-Maldives relations, prioritizing economic growth, maritime security, and regional stability in the Indian Ocean.
