Modi to visit Maldives; UPI, ₹30B swap line on agenda
What's the story
Prime Minister Narendra Modi is set to embark on a two-day visit to the Maldives from July 25-26, at the invitation of President Mohamed Muizzu. The visit will coincide with the 60th anniversary of the establishment of diplomatic relations between the two countries. During his trip, PM Modi will be the guest of honor at independence celebrations and hold bilateral meetings with President Muizzu.
Diplomatic initiatives
India to launch UPI services in Maldives
Ahead of PM Modi's visit, India has announced plans to launch Unified Payments Interface (UPI) services in the Maldives. This move is part of broader efforts to enhance economic ties. A ₹30-billion Indian swap line is also under consideration as part of efforts to improve bilateral ties, per CNN-News18. Foreign Secretary Vikram Misri said, "It's a question of working hard at a relationship," highlighting the turnaround since 2023 when diplomatic relations were strained.
Strategic partnership
Discussions on free trade agreement expected during PM's visit
PM Modi's visit will also focus on discussions about a free trade agreement (FTA) between the two countries. Misri said India's recent assistance has improved the Maldives's foreign exchange position, helping it avoid difficult outcomes. The $400 million swap line has been almost fully utilized, and now the ₹30 billion Indian swap line might be drawn upon.
Development initiatives
PM Modi to inaugurate infrastructure projects in Maldives
The foreign secretary said that significant progress has also been made on the MNDF building project, with an announcement expected soon. PM Modi's visit will also see him inaugurating some infrastructure projects in the Maldives. According to Misri, India is exploring new areas of cooperation with the Maldives, including renewable energy and fisheries. The Greater Male Connectivity Project is a flagship project that aims to connect four islands and improve infrastructure in the region.
Economic ties
India is 1 of Maldives's largest trading partners
India is one of the Maldives's largest trading partners, with bilateral trade nearing $500 million. The island nation is also a crucial partner in India's Neighborhood First policy and MAHASAGAR vision. Twin currency swap arrangements were made during President Muizzu's visit to India in 2024, amounting to $400 million and ₹30 billion. The State Bank of India has also continued to re-subscribe to Maldives treasury bills as part of ongoing economic cooperation efforts between the two nations.