Maldives President Thanks India For Debt Relief, Hopes For Free Trade Deal

Emphasising the need to alleviate the local shortages of US dollars, he said that the Maldives government is negotiating currency swap agreements with both New Delhi and Beijing.

The Maldives President also announced that his administration is negotiating a Free Trade Agreement (FTA) with the United Kingdom and expressed hope to reach a similar agreement with India.

Notably, the Mohamed Muizzu government in the Maldives took a reconciliatory tone after ties between the two nations soured, leading to a diplomatic row.

Last month, President Muizzu also attended the oath ceremony of Prime Minister Narendra Modi, after he took office for the third consecutive term.

Earlier this year, Muizzu sought debt relief measures in the repayment of the hefty loans taken from the country over consecutive governments. He even stated that India will continue to remain the Maldives’ “closest ally” and emphasised that there was no question about it.

The loan amount owed by Maldives to India by the end of last year stood at 6.2 billion Maldivian Rufiyaa, according to Maldives-based The Edition.

Notably, earlier this year, the International Monetary Fund (IMF) warned Maldives that it faces a high risk of debt distress without significant policy changes.

Notably, Maldives President Mohamed Muizzu has displayed ‘anti-India’ rhetoric and he even ran the electoral campaign on the line of ‘India Out’. The removal of Indian troops from the country was the main election campaign of Muizzu’s party.

Since coming to power, he has taken several steps that have been unconventional from the point of view of India-Maldives ties.

He departed from a long convention by not visiting India on the first official visit and instead went to Turkey, followed by China. During his visit, the two countries elevated their ties to comprehensive strategic cooperative partnership and signed around 20 agreements.

Last December, the Maldives said it would not renew the Hydrographic Survey agreement made with India.

After Muizzu government officially requested India to withdraw troops, the Indian government set up a High-Level Core Group to discuss the matter. The withdrawal of Indian troops was completed in May this year.

Days after the withdrawal of Indian soldiers, Maldives Defence Minister Ghassan Maumoon also acknowledged that the country’s defence forces were capable of operating the three aircraft donated by India,

The row between New Delhi and Male erupted after three Maldivian deputy ministers made derogatory comments against Prime Minister Narendra Modi, over his pictures from the visit to Lakshadweep.

PM Modi had called for the Indian island cluster to be developed as a destination for beach tourism and promotion of domestic tourism.

The matter snowballed into a major diplomatic row, with New Delhi summoning the Maldivian envoy and registering a strong protest against the viral posts. The three deputy ministers were suspended and they remain under suspension with pay.

Maldives Tourism Ministry data showed, earlier this year, that the number of Indian tourists visiting the Maldives dropped by 33 per cent as compared to last year.