India Boosts Maldives' Economy with $750 Million Currency Swap Deal

In a significant financial move, India has extended a helping hand to the Maldives, offering a $750 million currency swap agreement to alleviate the island nation's foreign currency shortage. This development came after a high-level meeting between Indian Prime Minister Narendra Modi and Maldivian President Mohamed Muizzu in New Delhi on Monday.

The agreement, orchestrated by the Reserve Bank of India and the Maldives Monetary Authority, falls under the South Asian Association for Regional Cooperation (SAARC) Currency Swap Framework. It comprises a $400 million swap arrangement and an additional ₹3,000 crore ($357 million) facility, which will remain accessible until 2027. This financial mechanism will facilitate payments between the two countries using their respective currencies.

Beyond the currency swap, the diplomatic encounter yielded several other collaborative initiatives. Among these is the introduction of India's RuPay card in the Maldives, aimed at enhancing financial integration between the two nations. Additionally, India will transfer 700 houses constructed with its assistance to the Maldives, furthering its commitment to infrastructure development in the island nation.

The bilateral talks also resulted in the signing of multiple memorandums of understanding (MoUs) across various sectors. These include agreements between India's Central Bureau of Investigation and the Maldives' Anti-Corruption Commission, fostering cooperation in combating corruption. Furthermore, MoUs were established between the two countries' policing institutes and judicial training institutions, as well as in the domains of sports and youth affairs.

This comprehensive package of financial aid and bilateral cooperation underscores India's strategic interest in strengthening ties with its Indian Ocean neighbor, while simultaneously addressing the Maldives' immediate economic challenges.