Prime Minister Narendra Modi on his state visit to Maldives announced a huge credit line of $565 million ( ₹4,850 crore) for the econoically struggling and debt ridden country,
The two countries also launched free trade agreement talks during a high-profile two-day visit of PM Modi to the island nation on Friday.
އިންޑިއާ އާއި ދިވެހިރާއްޖޭގެ ފުޅާ، ވަރުގަދަ އަދި ދުވަސްވީ އެކުވެރިކަމުގެ ރަމްޒެއް! https://t.co/7EUuA0sMGy
— Narendra Modi (@narendramodi) July 25, 2025
This is PM Modi’s first visit to the Maldives since Mohamed Muizzu took office in 2023. The visit is seen an effort by the two countires to strengthen the ties after a diplomatic rift amid Chinass growing influence in the ccountry.
Why Has India Announced ₹4,850 crore Credit Line to Maldives?
India has offered the credit line to support developemnt of infrstucture projects in the country.
“This will be used for projects linked to infrastructure development in line with the priorities of the Maldivian people,” PM Modi said, adding that both sides would also finalize a bilateral investment agreement.
Also Read: NewsX Exclusive: Ex-Foreign Minister Abdullah Shahid Lashes Out At Muizzu’s ‘India Out’ Policy
The two leaders issued a joint statement in which Maldivian President Mohamed Muizzu said his government is broadening the collaboration with India across various sectors.
“Looking ahead, we are fully committed to further strengthen our cooperation with India across a broad range of sectors through exchange of high-level visits,” Muizzu said.
The key focus areas which India and Maldives will work on include tourism, healthcare, and housing.
India To Enhance Defence Capabilities of Maldives
During India’s Union Budget in February 2025, financial aid to the Maldives was raised by ₹120 crore. The total grant allocation now stands at ₹600 crore, up from ₹400 crore last year, reflecting a 27 percent increase.
PM Modi made an important announcement sating that India India will support in strengthingn the Maldives’ defence capabilities, stating, “India will always support the Maldives to strengthen its defence capabilities.”
Thie announcement is seen a major signal particularly after the ties between the two countries ebbed after Muizzu assumed office.
He had pledged to end the Maldives’ “India First” foreign policy and move closer to China.
Despite the previous diplomatic rift, India has time and again come to help the island country to avert financial crisis set in after its tourism industry crumbled under India’s boycott.
PM Modi Given Ceremonial Welcome in Maldives
Modi landed in Malé on Friday morning and was received at Velena International Airport by President Muizzu and senior cabinet members. A ceremonial welcome and guard of honour followed at the Republic Square.
“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 wrote on X.
The two leaders jointly released commemorative postage stamps which featured traditional boats from both the countries. The postages symbolize the close cultural ties and shared maritime heritage between the countries.
“It is always friendship first,” Modi remarked, emphasizing that the relationship between the two countries goes beyond geographical proximity. “We are not just neighbours, but also friends.”
Also Read: PM Modi Gets Warm Welcome in Maldives, Set to Hold Bilateral Talks With President Muizzu
Zubair Amin is a Senior Journalist at NewsX with over seven years of experience in reporting and editorial work. He has written for leading national and international publications, including Foreign Policy Magazine, Al Jazeera, The Economic Times, The Indian Express, The Wire, Article 14, Mongabay, News9, among others. His primary focus is on international affairs, with a strong interest in US politics and policy. He also writes on West Asia, Indian polity, and constitutional issues. Zubair tweets at zubaiyr.amin
