INDIA - MALDIVES Evolution and Contemporary Issues

Importance of Maldives: –

Strategic location: In the Indian Ocean, Maldives archipelago comprising 1,200 coral islands lies next to key shipping lanes of communication which ensure uninterrupted energy supplies to countries like China, Japan, and India. More than 97% of India’s international trade by volume and 75% by value passes through the region.

Regional Security: As the pre-eminent South Asian power and a ‘net security provider’ in the Indian Ocean region, India needs to cooperate with the Maldives in security and defense sectors.

Member of SAARC: It is important for India to have the Maldives on board to maintain its leadership in the region. The Maldives was the only SAARC country which seemed reluctant to follow India’s call for a boycott of SAARC summit in Pakistan after the Uri attack.

Blue economy: The Maldives has an intrinsic role in advancing the blue economy through sustainable management and utilization of marine resources.

Maldives lies in close proximity to the west coast of India and its potential to allow a third nation’s naval presence in the area imbues it with significant strategic importance to India.

India has the ambition to be ‘Net-security provider’ in Indian Ocean region and this calls for close military and naval ties with Maldives so that India protects its own interests as well of its neighbours in the Indian Ocean region.

China is rapidly expanding its footprint in the Maldives though it opened an embassy in the island nation only in 2011. Thus, it becomes geo-politically and strategically important for India to maintain its presence in Maldives.

Operation Cactus – when India saved Gayoom’s regime from a coup in 1984
After the tsunami that struck the Maldives on December 26, 2004, India was the first country to rush relief and aid to the Maldives.
Operation NEER was initiated by the Indian government in response to the Maldives government’s request for help after a major fire broke out at the Male Water and Sewerage Company.

State Bank of India has been playing a vital role in the economic development of the Maldives since 1974 by providing loan assistance for promotion of island resorts, the export of marine products and business enterprises.
India developing High Impact Community Development Projects (HICDPs) in areas of livelihood and income generation, health, education, gender and child empowerment, sports and sustainable development.
India provided a budget support aid of Rs.10 crores to help stabilize the Maldivian fiscal position.
In January 2014, India released $25 million to meet Maldives’ import expenditure. This was done in the context of the Framework Agreement on Cooperation for Development of 2011.
With the Maldives reeling under mounting Chinese debt, India in 2018 announced a $1.4 billion financial assistance to the island nation.
Currently, India has provided the US $ 100 million Standby Credit facility (SCF) to the Maldives, including long-term loans and revolving credit for trade.

The defence cooperation between India and Maldives ranges from training and joint combat exercises to help in maritime surveillance as well as the supply of military equipment to the country.
Exercise DOSTI: The focus of these exercises was on Maritime Search and Rescue (M-SAR), Humanitarian Assistance and Disaster Relief (HADR), Marine Pollution Response (POLRES), and Anti-piracy operations.
Exercise EKUVERIN: This bilateral annual exercise commenced in 2009 at Belgaum, India.

Indians are the second largest expatriate community in the Maldives. About 25% of Doctors and Teachers in Maldives are Indian nationals.
The India Cultural Center (ICC) in Male was inaugurated in 2011, which conducts courses in yoga, classical music and dance. Also, Hindi commercial films, TV serials and music are immensely popular in Maldives.

Maldives-China FTA: This is Maldives’s first FTA with any country, and China’s second FTA with any country in South Asia after Pakistan. There are concerns that it could lead to increased Chinese military presence in the island nation.
Chinese Investment: The growth is driven by massive infrastructure projects, including the development of Hulhule Island and the “Friendship” bridge connecting it to Male.
The Maldives’ reliance on China to develop more than US$2.5 billion in infrastructure projects and the resulting accumulation of foreign debt— 40 per cent of the country’s GDP, is a concern for India. These raises concerns about Chinese debt-trap diplomacy.
Internal crisis on Political and religious lines in Maldives which drives its foreign policy as evident in the past.
Political instability in Maldives as democracy is a cause of concern as it will have impact on India’s relations.
Its political instability has challenged overall security of the Indian Ocean by increasing radicalization —over 200 Maldivians reportedly joined the Islamic State

Both countries need to enhance regional cooperation by using common platforms such as the Indian Ocean RIM Association and Indian Ocean Naval Symposium.
While the recent ‘India-First Policy’ of the Maldives and India’s ‘Neighbourhood First Policy’ are intuitively complementary, implementing these policies with strategic sensitivity is of the utmost importance.