The article published in the editorial section of The Hindu Epaper sheds light on the strained diplomatic relations between India and Maldives, Maldives’ relation with China and how Maldives has realized that it cannot completely alienate India due to Maldives’s economic debt.
Background Information
India and the Maldives share a deep relationship with strong historical, cultural, and diplomatic ties. Their collaboration spans economic, defence, and environmental areas.
Shared Heritage– Both countries have deep cultural and historical connections, including shared traditions and interpersonal bonds.
High-Level Engagements– Frequent high-level visits bolster bilateral ties and strategic cooperation.
Trade and Investments-Robust trade and developmental aid reflect their strong economic partnership.
Strengthening Defense India– supports the Maldives in defence training and security efforts.
Unified Climate Action-Joint efforts to address climate challenges demonstrate their commitment to sustainable development.
Supporting Stability– India stands with the Maldives during political instabilities, supporting democratic processes and stability.
During COVID-19 India provided medical and economic assistance during the pandemic, reinforcing their ties.
The relationship between India and the Maldives is rooted in mutual respect, strategic cooperation, and strong socio-economic linkages, contributing to regional stability and development.
Recent challenges to India-Maldives relations
The recent “India Out” campaign in Maldivian politics has raised concerns about Indian presence being seen as a threat to Maldivian sovereignty. The campaign demands the withdrawal of Indian military personnel, with the President of Maldives having set a deadline of 15th March 2024, for their departure.
In addition, the tourism industry in the Maldives has come under scrutiny due to a diplomatic dispute stemming from negative remarks made about the Indian Prime Minister during his visit to the Lakshadweep islands. This has led to a trending boycott Maldives movement on social media as a response to the controversy.
ARTICLE EXPLANATION
Mohamed Muizzu, the President of the Maldives, has adopted a pro-Maldives policy since swearing-in in November 2023. This includes reducing dependence on India, increasing relations with China, and diversifying foreign policy. Muizzu’s foreign policy is influenced by domestic and external factors, including his party’s “India Out” campaign and his desire to further nationalist sentiments and voter base in the Maldives. He also seeks to deepen relationships with Japan, Saudi Arabia, Türkiye, UAE, the UK, and the United States.
MALE’S ECONOMIC DIFFICULTIES
The Maldives’ economy is facing serious challenges due to increasing debt maturities, low revenues, and a decline in foreign reserves. With a debt-to-GDP ratio of 110% and a foreign reserve of $622 million, the Maldives struggles to maintain its foreign reserves. The government relies heavily on imports and has convinced import partners, India and China, to pay for imports in local currency.
TIES WITH CHINA AND INDIA’S POLICY
China is falling short of Male’s expectations, with both countries signing over 20 Memorandums of Understanding and agreeing to revive the Belt and Road Initiative projects and free trade agreement. The Maldives signed a defence pact with China in March 2024 and has upgraded relations to a ‘China-Maldives Comprehensive Strategic Cooperative Partnership’ from 2024 to 2028. However, Beijing is hesitant to invest in the country’s mega-infrastructure, focusing on community development, housing projects, and capacity-building initiatives. The Maldives owes China around $1.5 billion, and China’s debt relief would complicate future borrowing prospects. The Chinese Ambassador has expressed wariness in offering new loans due to Male’s increasing debt burden. Other countries have been slow to reciprocate Muizzu’s demands of economic partnerships and have primarily focused on capacity building and maritime security. India’s accommodative policy and fulfilment of Muizzu’s demands have facilitated this rapprochement.
THE SIGNAL FROM NEW DELHI
In May, Maldivian Foreign Minister Moosa Zameer visited India, marking the first high-level visit by the Indian government. India requested reciprocal sensitivities and extended a $50 million treasury bill for a year on zero interest to the Maldives. India invited Mr Muizzu to Mr. Modi’s swearing-in, indicating continued engagement with Male, regardless of power. The Maldivian leader hopes that India’s accommodative policy will be reciprocated by respecting its sensitivities. With nearly 65% of Indian EXIM loans yet to be disbursed, Mr. Muizzu hopes the invitation offers an opportunity to improve bilateral ties with India and rescue the country’s economy. However, he realizes he cannot completely alienate India and may benefit more by balancing and playing one country against the other.
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