| GS Paper 2 : India and its Neighbourhood Relations |
Why in the News?
Recently, Maldives’ President, Mohamed Muizzu visited to India. Both leaders of India and Maldives conducted a thorough review of the bilateral relations between their countries, acknowledging the progress made in strengthening their historically close ties.
What’s covered in this article?
- Key results from the bilateral meeting
- Significance of Maldives To India
- Analysis of the visit
- Way Forward
Key Outcomes of the Bilateral Meeting
- Vision Document Unveiled to Strengthen Ties
Both India and Maldives agreed to elevate their relationship into a Comprehensive Economic and Maritime Security Partnership.
A Vision Document was published outlining various elements of this partnership, serving as a roadmap for the relationship in the coming years.
This framework aligns India’s Viksit Bharat 2047 vision with the Maldives’ goal of becoming a developed country by 2040.
- Economic and Financial Support
India extended financial aid to the Maldives, including INR 30 billion and USD 400 million, through a currency swap arrangement to help stabilize the country’s economy, which is facing declining foreign reserves.
Discussions for a Free Trade Agreement (FTA) were initiated, aiming to boost Indian investments and bilateral economic cooperation.
Both countries India and Maldives agreed to conduct trade transactions in their local currencies.
- Political Engagement
India and Maldives agreed to strengthen political exchanges, including interactions between their respective parliaments and local governments.
A Memorandum of Understanding (MoU) will formalize collaboration between the two countries’ parliaments.
- Rebuilding Defence and Security Cooperation
India and Maldives committed to enhancing their defence ties, which had suffered when the President of Maldives expelled Indian military personnel earlier in the year.
India will assist in refitting a Maldivian Coast Guard vessel, and both countries will cooperate in maritime security, disaster response, and capacity building.
New initiatives to improve Maldives’ maritime security include providing radar systems, defence platforms, and infrastructure support.
- Defence and Maritime Security Initiatives
Both sides acknowledged the need for continued collaboration in defence and maritime security.
Maldives’ surveillance capabilities will be enhanced with India’s support, along with efforts to strengthen its national defence infrastructure and disaster preparedness.
The Maldivian Ministry of Defence building, constructed with India’s help, was inaugurated.
Key Agreements Signed
- During the meeting, five agreements were signed between India and the Maldives during Maldives’ President Visit to India covering a currency swap, judicial training, anti-corruption measures, law enforcement training, and youth and sports development.
- Additionally, during Maldives’ President Visit to India, both countries inaugurated 700 social housing units, launched a new runway at Hanimaadhoo International Airport, and introduced the RuPay card in Maldives, facilitating easier payments for Indian tourists.
Development Collaboration
- India and Maldives will partner on several infrastructure projects, such as ports, airports, roads, and housing.
- Key projects include completing the Greater Malé Connectivity Project (GMCP) and conducting feasibility studies for new island connections and a port at Thilafushi.
Digital Cooperation
- India will support Maldives in enhancing its digital and financial infrastructure by launching services like UPI and RuPay to improve governance and payment systems for tourists.
Health Collaboration
- India will help establish Jan Aushadhi Kendras in Maldives and support the country’s emergency medical evacuation capabilities.
Capacity Building and Training
- India will continue offering tailored training programs for civil servants and launch initiatives focused on women-led development.
- A Start-up Incubator-Accelerator will be set up in Maldives to encourage youth entrepreneurship.
Stronger People-to-People Connections:
- India and Maldives have pledged to deepen people-to-people ties.
- Plans include opening Maldivian and Indian consulates in Bengaluru and Addu City, respectively.
- Given the significant tourism, education, and healthcare exchanges, India will help establish higher education institutions and skill development centers in Maldives.
- An ICCR Chair will also be set up at Maldives National University to encourage academic collaboration.
Significance of Maldives for India:
Location:
The Maldives is strategically located close to India’s west coast, just 70 nautical miles from Minicoy Island and 300 nautical miles from the mainland.
Trade Routes:
Positioned along vital maritime trade routes between the Gulf of Aden and the Strait of Malacca, the Maldives plays a key role in India’s external trade. Nearly half of India’s trade and 80% of its energy imports pass through these waters, making the Maldives a crucial “toll gate” for India.
Strategic Importance:
Given its position in the Indian Ocean, the Maldives is significant for India’s security and stability in the region.
Countering China:
India views the Maldives as a key partner in balancing China’s expanding influence in the Indian Ocean, helping to maintain regional power dynamics.
Economic Partnership:
India is a major investor in the Maldives and a leading tourism market, with ongoing infrastructure and trade projects solidifying economic ties.
Defence and Security Cooperation:
India has been a vital defence partner to the Maldives since 1988. In 2016, the two nations signed a comprehensive Action Plan for Defence to strengthen their military cooperation. India provides nearly 70% of Maldives’ defence training, either on Maldivian soil or at Indian military academies.
Significance of India for the Maldives:
Essential Commodities:
India supplies the Maldives with daily necessities, including rice, fruits, vegetables, spices, poultry, medicines, and life-saving drugs.
Education:
Many Maldivian students pursue higher education in Indian institutions every year.
Economic Dependence:
In 2022, of the Rs 50 crore trade between India and the Maldives, Rs 49 crore were Indian exports, making India the second-largest trading partner for the Maldives.
Disaster Relief Assistance:
India has been the Maldives’ first responder during crises. After the 2004 tsunami, India promptly provided aid, and when Malé faced a drinking water shortage in 2014, India swiftly airlifted water supplies. During the COVID-19 pandemic, India sent essential medicines, protective gear, and vaccines to assist the Maldives.
Analysis of the Visit
Background: Strained India and Maldives Relations
- President of Maldives, Muizzu’s visit comes after a period of tension between the two countries.
- After taking office in November 2023, President of Maldives, Muizzu campaigned on an “India Out” agenda, seeking the removal of Indian military personnel from Maldives.
- This stance strained ties, as Maldives was seen as leaning toward China, evident in his visits to Turkey and China, bypassing India.
- Diplomatic relations were further complicated by derogatory remarks made by Maldivian officials about Indian PM Modi, which led to online confrontations between citizens of both India and Maldives.
- The downturn in relations also affected tourism, with Indian tourist numbers to Maldives falling by 50,000, causing a $150 million revenue loss.
Muizzu’s Change in Approach
- President of Maldives, Muizzu has softened his stance toward India, likely due to the Maldives’ pressing economic challenges.
- Despite his earlier rhetoric, the President of Maldives stressed that Maldives would not undermine India’s security and emphasized a balanced foreign policy, including maintaining ties with both India and China.
- Facing economic difficulties, including debt repayment and downgraded credit ratings by Moody’s, President of Maldives’ visit is seen as a move to secure financial aid from India.
Way Forward:
The growth of India-Maldives relations highlights the influence of shifting geopolitical factors, leadership changes, and shared regional priorities.
India remains unwavering in its commitment to the Maldives, consistently making extra efforts to strengthen ties. Any hasty decisions that undermine this well-established and multifaceted partnership would likely have a greater negative impact on the Maldives than on India.
By recognizing and confronting these challenges, both India and Maldives can steer through the complexities of their relationship, fostering a stronger, more resilient, and mutually beneficial partnership moving forward.
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