India Extends Financial Support to Maldives with Rollover of Treasury Bill

India has agreed to extend its budgetary support to the Maldives government by rolling over a USD 50 million Treasury Bill for another year. This decision was made at the request of the Maldivian government, as confirmed by the Indian High Commission in the Maldives on Thursday.

Details of the Rollover

The State Bank of India (SBI) has subscribed to the USD 50 million Treasury Bills issued by the Maldivian Ministry of Finance for an additional year, following the maturity of the previous subscription on September 19. This marks the second rollover this year, with the first occurring in May.

In a press release, the High Commission noted, “Earlier in May 2024, SBI had similarly subscribed a USD 50 mn T-bills under the same mechanism, again on the request of the Government of Maldives. These subscriptions have been made at the special request of the Government of Maldives as emergency financial assistance.”

Strategic Partnership

The Indian High Commission emphasized the importance of the Maldives as a key maritime neighbor and partner under India’s ‘Neighbourhood First’ policy and Vision SAGAR (Security and Growth for All in the Region). The release stated, “India has assisted Maldives in times of need, and the current subscription of T-bills reflects India’s continued support to the Government and the people of the Maldives.”

Positive Reactions from Maldives

Former Maldivian Foreign Minister Abdulla Shahid expressed gratitude towards India for extending budgetary support, referring to India as a “time-tested friend” and “unwavering ally.” In a post on X, he stated, “Delighted to hear that India has subscribed to the USD 50 million T-Bills issued by the Government of Maldives for one more year, as emergency financial assistance.”

Strained Relations and Recent Developments

Ties between India and the Maldives have faced challenges since President Mohamed Muizzu took office. He initially demanded the removal of around 88 Indian military personnel, who were later replaced by Indian civilians. Despite earlier tensions, Muizzu’s administration has recently adopted a reconciliatory approach, aiming to restore diplomatic relations after a series of controversies earlier this year.

Since January, efforts to mend ties have included high-level visits, such as President Muizzu’s attendance at Prime Minister Narendra Modi’s swearing-in ceremony. External Affairs Minister S. Jaishankar also visited the Maldives in August, where he signed memorandums of understanding and inaugurated six High Impact Community Development Projects (HICDPs).

During his meeting with President Muizzu, Jaishankar conveyed greetings from Prime Minister Modi, reinforcing the commitment to strengthening bilateral relations.