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Indian Prime Minister Narendra Modi has announced a $565 million financial package for the Maldives to support its defence and infrastructure development, reaffirming India’s commitment to the strategically located Indian Ocean nation.
On his first official visit to the Maldives since securing a third term in office, Modi emphasized India’s role as the Maldives’ primary partner in times of need.
“India will continue to support the Maldives in strengthening its defence capabilities,” Modi said. “Peace, stability, and prosperity in the Indian Ocean region are our shared goals.”
The announcement comes amid India’s concerns about the Maldives’ shifting geopolitical alignment, particularly following the 2023 election of President Mohamed Muizzu, who campaigned on an explicitly anti-India platform. Upon taking office, Muizzu demanded the withdrawal of a small Indian military contingent that operated search-and-rescue helicopters and a reconnaissance aircraft in the country.
However, Muizzu has since moderated his rhetoric and has met with Modi twice in New Delhi. Both leaders have expressed a desire to start a "new chapter" in bilateral relations.
The $565 million credit line unveiled by Modi aims to help the Maldives overcome its current foreign exchange crisis, despite the country’s thriving high-end tourism sector. The funding will support a range of sectors, including defence, healthcare, housing, and education.
Modi also inaugurated multiple India-funded infrastructure projects during his visit, including a 4,000-unit housing scheme and major road construction projects.
“India’s continued assistance to the Maldives through the export of essential commodities is a key facet of our bilateral cooperation,” President Muizzu said, welcoming the new line of credit.
Modi is scheduled to depart the Maldives on Saturday after attending the country’s 60th Independence Day celebrations in the capital, Male.
Both India and China are major lenders to the Maldives and are competing for influence in the region. The Maldives, famous for its white-sand beaches and luxury resorts, has become a geopolitical hotspot due to its location astride key global shipping lanes.
India has long regarded the Maldives, along with nearby Sri Lanka, as falling within its traditional sphere of influence and remains wary of China’s growing strategic footprint in the Indian Ocean.
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