Published: July 25, 2025 3:23 pm
Author: RT
New Delhi has announced a $565 million credit line to the debt-ridden island nation
India and the Maldives have agreed to boost bilateral ties during Prime Minister Narendra Modi’s two-day visit to the island nation, with the South Asian neighbors signing eight agreements on Friday.
Among the key agreements is a $565 million credit line from New Delhi to the debt-ridden island nation.
“This will be used for projects linked to infrastructure development in line with the priorities of the Maldivian people,” Modi said.
The countries have also launched talks for a free trade agreement.
In addition, a network-level agreement was concluded to bring India’s flagship real-time payment system Unified Payments Interface to aid financial connectivity in the Maldives.
President Muizzu and I inaugurated a new building of the Ministry of Defence in Malé. This is yet another instance of strong India-Maldives cooperation.@MMuizzu pic.twitter.com/k540iszTyM
— Narendra Modi (@narendramodi) July 25, 2025
The visit is Modi’s third to the island nation and the first by a head of government during Maldivian President Mohamed Muizzu’s tenure. It follows a diplomatic row between the two nations after Muizzu won the 2023 election and demanded the withdrawal of Indian troops from the Maldives, calling India a “bully.”
A very warm welcome to His Excellency Prime Minister Shri @narendramodi to the Maldives.
Today Prime Minister and I held productive talks where we focused on carrying forward the Maldives-India development partnership in key areas of common interest and on providing all the… pic.twitter.com/ErAXo7gZzQ
— Dr Mohamed Muizzu (@MMuizzu) July 25, 2025
After Muizzu assumed office in September 2023, the Maldives pursued a new policy direction, seeking to bolster ties with China and diversify its relationships, which was perceived as a strategic shift away from its traditional dependence on India.
The relationship began to mend in October 2024, when India approved a $400 million currency swap agreement and a $100 million Treasury bill rollover to aid its neighbor.
READ MORE: India extends aid to neighbor amid efforts to reset ties
During his two-day visit to Male, Modi will attend the 60th anniversary celebrations of Maldivian independence. The countries will also commemorate 60 years of diplomatic relations.
“India is also proud to be the most trusted friend of the Maldives,” Modi said on Friday. “Be it a disaster or a pandemic, India has always stood by as the ‘First Responder.’”’
