With the recent signing of development project pacts between India and Maldives, the dynamics of their relationship have come to the fore once again. Both Maldives and Sri Lanka maintain a significant position in India’s maritime neighborhood within the Indian Ocean Region. Their importance is indicated by India’s ‘SAGAR’ (Security and Growth for All in the Region) vision and ‘Neighbourhood First’ policy.
Details of the Pact
The pact includes grant assistance of 100 million Rufiyaa (currency of Maldives) earmarked for the High Impact Community Development Project (HICDP) scheme. This funding is set to facilitate numerous socio-economic development projects across the country. In addition, the pact also entails the construction of a sports complex in Gahdhoo and an academic collaboration between Maldives National University and Cochin University of Science and Technology.
India-Maldives Security Partnership
Defence cooperation between the two nations extends to joint exercises such as “Ekuverin”, “Dosti”, “Ekatha”, and “Operation Shield” initiated in 2021. India provides the majority of training opportunities for the Maldivian National Defence Force (MNDF), catering to approximately 70% of their defence training needs. An USD 80-million contract was signed for the Addu reclamation and shore protection project, along with the construction of a drug detoxification and rehabilitation centre in Addu with Indian assistance.
Economic Cooperation and Infrastructure Projects
Tourism forms the backbone of the Maldivian economy, with the country becoming a preferred destination for Indian tourists and job seekers. Afcons, an Indian company, bagged the contract for the largest-ever infrastructure project in Maldives – the Greater Male Connectivity Project (GMCP) – in August 2021. This propelled India to the position of being Maldives’ second-largest trading partner, up from the fourth position in 2018. In 2021 alone, bilateral trade witnessed a growth of 31%, despite the prevailing pandemic-related challenges. A Bilateral USD Currency Swap Agreement was also signed between RBI and Maldives Monetary Authority on July 22, 2019.
Challenges in India-Maldives Relations
India’s primary concern remains the potential impact of political instability in the region on its own security and development. The arrest of Maldivian opposition leader Mohamed Nasheed on terrorism charges in February 2015 and the subsequent political crisis posed a significant diplomatic challenge for India’s neighborhood policy. Over the last decade, an increase in the number of Maldivians getting drawn towards terrorist groups like the Islamic State (IS) and Pakistan-based jihadist groups has been noted. This raises the prospect of these remote Maldivian islands being used as launch pads for terror attacks against India and Indian interests. China’s growing strategic presence in the Maldives also remains a concern due to the uncertain dynamics of Sino-Indian relations.
The Way Forward
India must play a crucial role within the Indo-Pacific security space to ensure regional security in South Asia and surrounding maritime boundaries. India’s proactive stance is required in light of the growing influence of extra-regional powers, particularly China, in India’s maritime sphere. It is essential for the Indian government not to take the ‘India Out’ campaign lightly, as any negligence could alter the domestic political scenario in the Maldives and destabilize India’s currently favorable relationship with the country.