India, Maldives Sign Agreement: India announces Rs 4,850 crore Line of Credit to Maldives

Prime Minister Narendra Modi held talks with the President of Maldives, Mohamed Muizzu, at the President’s office on Friday. Both leaders reviewed the entire spectrum of India-Maldives relations and reaffirmed their commitment to further strengthening bilateral ties.

The two nations also signed an agreement for a Line of Credit (LoC) of INR 4,850 crores to the Maldives, besides an amendatory agreement on reducing annual debt repayment obligations of the Maldives on Government of India-funded LoCs.

The Ministry of External Affairs (MEA) posted on X after the bilateral discussions, "They discussed cooperation in the fields of development partnership, capacity building, health, infrastructure, digital economy, aquaculture, climate change and renewable energy. The two leaders called for closer collaboration to enhance peace, progress and prosperity of the Indian Ocean region." 

PTI reports that, later, both nations declared that they had signed multiple Memorandums of Understanding (MoU), including ones on fisheries and aquaculture, and had agreed on the terms of reference of the India-Maldives Free Trade Agreement (FTA).

An MoU was also signed between the Indian Institute of Tropical Meteorology (IITM), Ministry of Earth Sciences and the Maldives Meteorological Services (MMS), Ministry of Tourism and Environment.

Additionally, the Ministry of Electronics and IT of India and the Ministry of Homeland Security and Technology of the Maldives inked a Memorandum of Understanding on collaboration in the area of sharing successful digital solutions executed at a population scale for Digital Transformation.

According to PTI, the prime minister's visit marked a major turnaround in India-Maldives ties after a spell of unease.

The leaders also reviewed the status of the 2024 adoption of the India-Maldives Joint Vision for a 'Comprehensive Economic and Maritime Security Partnership'. 

Prime Minister Modi is making his third trip to the Maldives; he has already been to the Indian Ocean archipelago in 2018 and 2019. This is also the first time a head of state or government has visited the Maldives under Mohamed Muizzu's presidency, which started in November 2023.

The Maldives holds an important place in India's "Neighbourhood First" policy and MAHASAGAR (Mutual and Holistic Advancement for Security and Growth Across Regions) vision, the prime minister said.

PTI reports, Modi said that mutual cooperation in the field of defence and security is a testament to mutual trust and that  India will always support the Maldives to strengthen its defence capabilities.

"Deeply touched by the gesture of President Muizzu to come to the airport to welcome me. I am confident that India-Maldives friendship will scale new heights of progress in the times to come," Modi said in a social media post.

Given that Muizzu, who is believed to be close to China, took office in the island nation in November 2023 on the strength of an "India Out" campaign, the improvement in bilateral relations gains significance, reported PTI. 

The ties were severely strained as a result of his policies during the first few months of his presidency.  He has called on Indian armed men to leave his country within hours of taking his oath.  India then substituted civilians for the personnel.

 In order to maintain and run an aircraft and two helicopters used for rescue and humanitarian missions, Indian military troops were sent to the Maldives.

It was thought that New Delhi's persistent efforts, like as helping the island nation with its economic problems, contributed to the restoration of relations.