New Delhi: India has “assured continued support” to Maldives amidst the island nation’s economic challenges, as ties continue to thaw following a number of challenges right after Mohamed Muizzu assumed the presidency in Malé at the end of 2023.

“External Affairs Minister S. Jaishankar and Foreign Minister Khaleel held bilateral discussions and took stock of progress made on the understandings reached during the State Visit of President Dr. Muizzu to India in October 2024 and followed-up on issues that need further focus from both sides,” said the readout published Friday by the Ministry of External Affairs (MEA) on the meeting between the Indian and Maldivian foreign ministers.

“Foreign Minister Khaleel, on his part, appreciated the timely emergency financial assistance extended by India to Maldives in times of need, reflecting India’s role as the ‘First Responder of Maldives’.”

Maldivian foreign minister Abdulla Khaleel was in New Delhi for a three-day visit from 2 January till 4 January with the aim to bolster trade ties, as well as seek investments. The island archipelago’s long-term debt has been downgraded to junk status by the American credit ratings agency Fitch, last June, due to worsening liquidity.

Free and Fair Journalism Will Continue to be Important in 2025

You are crucial in ensuring that independent journalism thrives. Support us in delivering unbiased, in-depth stories that matter.

A year ago, however, such a discussion seemed unlikely, given the heated political rhetoric amongst both governments. Three deputy ministers from Muizzu’s government in January 2024 had taken aim at Narendra Modi, with one–Mariyam Shiuna–purportedly calling the Indian prime minister leader a “clown” and a “puppet of Israel”.

This set off Indian users on social media sites, with accounts calling for the boycott of tourism to Maldives. This happened days after Modi, who visited the Lakshadweep had announced a number of projects to boost tourism to the Indian union territory.

“The first phase of ties between Maldives and India in the last year began a little before the elections with the perceptions of the Indian government backing Ibrahim Solih and the MDP [Maldivian Democratic Party]. When Muizzu was elected, he was insistent on sticking to his ‘India Out’ campaign promises,” Sidharth Raimedhi, a fellow at the Council for Strategic and Defence Research in New Delhi, told ThePrint.

“The social media battle early in the year was ugly and was potentially the lowest point in ties. Maldives was clear in reviewing its agreements with India, including the eviction of Indian military personnel from the island. The phase was focused on political and sovereignty issues.”

It looked like the new Maldivian president, who was inaugurated in November 2023, was not just keen on diversification of Malé’s ties but was taking decisions at an extremely quick pace, from visits to Türkiye and China, within the first three months of assuming the presidency.

With Ankara, he signed a $37 million deal for UAVs, sought food imports to change Maldives’ security partnership with India. In China, he sought investments for mega infrastructure projects and signed over 20 memorandums of understanding (MoUs) with Beijing. Meanwhile, with India, he was emphasising the removal of the unarmed Indian officers, who were present in Maldives at the request of Malé to operate three aviation platforms.

“For the first few months, there was a very public pro-China stand emanating from Malé. However, a number of promises from Türkiye and China did not materialise due to a number of reasons including the situation in West Asia,” Aditya Gowdara Shivamurthy, an associate fellow at the strategic studies programme with the Observer Research Foundation, explained to ThePrint.

It seemed at the time, India’s diplomacy with the Maldives was on the defensive, eventually replacing the 80-odd officers with a technical team by May 2024.

Also Read: MEA slams WaPo reporting on ‘anti-Muizzu plot’, Pakistan killings. ‘Nurse compulsive hostility’

The change 

While the politics and rhetoric indicated a diplomatic chill, the economic situation of the neighbouring country did not improve. By May, the Maldivian government was urging New Delhi to roll over a $50 million loan, making a special request to “secure budgetary support”.

The roll-over of the $50 million loan was agreed to by New Delhi, temporarily easing the debt repayment schedule, which is estimated to spike to $1.07 billion by 2026. The State Bank of India agreed to roll-over the loan for a year.

This roll-over was the “gesture” which slowly changed the tone in the ties, explained Shivamurthy.

“The start of the second phase in ties has everything to do with economics, which was almost glaringly absent in the first phase. The economic crisis had to do with foreign exchange reserves, and India brought its Sri Lanka play book to the fore. It sensed an opportunity, moved fast, starting with the roll-overs and culminating in $757 million in funding granted in October,” said Raimedhi.

In June, Muizzu visited India for Modi’s inauguration and then returned in October for a state-visit, which rebooted ties between New Delhi and Malé. Two of the important outcomes from the visit were the roughly $700 million in currency swaps for the beleaguered economy and the Comprehensive Economic and Maritime Security Partnership vision.

In one of his earliest decisions after coming to power, Muizzu informed India of Malé’s intent to let a hydrographic agreement signed between the two countries expire in June 2024, while also allowing Chinese research vessels to dock at their ports. However, by October 2024, Muizzu seemed to at least be open to the idea of discussing sensitive security matters.

Muizzu’s party, while in opposition, had opposed India’s proposal to open a consulate in Addu. While In New Delhi as President, both countries announced their intention to open new consulates in either country, with Addu being the location for India.

“India waited for Maldives to indicate what it wanted from the relationship and how to take it forward and accordingly accommodated this within their own approach,” explained Shivamurthy. This accommodative stance is a unique phenomenon to New Delhi’s stance with its partners in South Asia.

The Indian government could have taken to social media to celebrate the turnaround in ties with Maldives, however, New Delhi chose to “show sensitivity” to Muizzu’s domestic standing, highlighted Raimedhi.

India had finally been able to build bridges with the Muizzu administration, to understand what it wanted and accordingly adapt. The result has been the pace in which the president looked to diversify ties has seemingly slowed down, at least publicly, with India regaining the image of a “first responder” for the island archipelago.

“Malé has been more understanding of India’s red-lines and seems to be accommodative towards these today. Shifting Chinese agricultural projects from Uthuru Thila Falhu (UTF), to a different location. At UTF India is aiding in the construction of a harbour for its coast guard is one example of India’s red lines,” said Shivamurthy.

While a year since ties seemed to be extremely chill has passed, New Delhi and Malé have been able to form some sort of a working equilibrium. However, how long the equilibrium can be maintained depends on how long China continues to solve its own domestic challenges before looking towards the Indian Ocean region countries again.

“There is increasing discontent domestically over its economy. With the number of domestic issues, Malé at the moment would not be too keen on antagonising their only proactive diplomatic partner in India,” said Shivamurthy.

(Edited by Tony Rai)

Also Read: India & Maldives reboot ties, sign currency swap agreements as Muizzu & Modi meet