Maldives is located south of India’s Lakshadweep Islands in the Indian Ocean. Both nations established diplomatic relations after the independence of Maldives from British rule in 1966. India was one of the first nations to recognize Maldives’ independence.India has supported Maldives’ policy of keeping regional issues and the latter has seen friendship with India as a source of aid as well as a counterbalance to Sri Lanka.

  • Maldives is important for India because of its geostrategic location on Sea Lanes of Communications, security of Indian Ocean, vast Exclusive Economic Zone, piracy issues, and cultural, historical linkage with India.
  • The Maldives has emerged as the latest arena for the intensifying geostrategic rivalry between China and India – two Asian giants vying for influence in the Indian Ocean
  • Maldives is an Islamic country. Tourism and Fishing are its major sources of income.
  • In 2008, India helped it to obtain democracy. Before that, it was autocracy under Gayoom, then democracy under Nasheed, again recent autocracy under Yameen with final democratic election in September in which President Solih took the leadership.
  • India and Maldives officially and amicably decided their maritime boundaryin 1976
  • India and Maldives signed a comprehensive trade agreement in 1981.

Both nations are founding members of the South Asian Association for Regional Cooperation (SAARC), the South Asian Economic Union and signatories to the South Asia Free Trade Agreement.

Importance of Maldives to India

  • Geostrategic: Maldives is located just 700 km from the strategic Lakshadweep island chain and 1,200 km from the Indian mainland, and the growing Chinese presence in the archipelago could have serious security implications.
  • Despite its small size, the Maldives has an outsized strategic importance for India, given its location astride the sea lanes through which much of India’s shipping cargo passes
  • The northernmost tip of the Maldives is just 70 nautical miles from the southernmost point of India’s own Lakshadweep archipelago, where the Indian navy has a base
  • Indian Ocean Region hegemony:Chinese heavy presence in Maldives would have given China an opportunity and a base to influence and control the Indian Ocean region.Also, the energy supplies coming from Gulf nations to India pass through this area.
  • Regional imbalance: India enjoys unparalleled access and influence in many of the Indian Ocean island states, including the Maldives, Seychelles, and Mauritius which has been a problem for China. China-Maldives bonhomie can act as a counter to Indian influence in the region.
  • Indian expatriates: There are about 25,000 Indian expatriates in Maldives who are engaged in a number of professional pursuits and their security is also of prime concern for India.
  • Blue economy:Maldives plays an integral role in realizing the potential of Indian Ocean blue economy as a contributor to the security and sustainable development of sea resources.
  • Tourism: India and Maldives see regular tourist visits between the two and Indian tourists also account for close to 6% of tourists Maldives receives each year.
  • Health: India is a preferred destination for Maldives citizens seeking health services, which boosts Indian healthcare sector.
  • Political uncertainty in Maldives could prove a fertile breeding ground for extremism and religious fundamentalism, smuggling and drug trafficking.Islamic State (IS) and Lashkar-e-Taiba are also reported to have established bases in Maldives.

Economic relations

  • India has provided extensive economic aid and has participated in bilateral programmes for the development of infrastructure, health, telecommunications and labour resources.
  • It established the Indira Gandhi Memorial Hospital in Malé, the capital of Maldives, expanded telecommunications and air links and increased scholarships for Maldivian students.
  • The State Bank of Indiahas contributed more than US$500 million to aid the economic expansion of Maldives.
  • India and Maldives have announced plans to jointly work to expand fisheries and tuna
  • The two sides also signed four agreements – for visa liberalization for segments such as Indian investors, cultural cooperation, IT and electronics cooperation, and improving the ecosystem for agriculture business.

Military relations

On April 2006 Indian Navy gifted a Trinkat Class Fast Attack Craft of 46 m length to Maldives National Defence Force’s Coast Guard.

India started the process to bring the island country into India’s security grid. India has also signed an agreement which includes following:

  • India will permanently base two helicopters in the country to enhance its surveillance capabilities and ability to respond swiftly to threats.
  • Maldives has coastal radars on only two of its 26 atolls. India will help set up radars on all 26 for seamless coverage of approaching vessels and aircraft.
  • The coastal radar chain in Maldives will be networked with the Indian coastal radar system. India has already undertaken a project to install radars along its entire coastline. The radar chains of the two countries will be interlinked and a central control room in India’s Coastal Command will get a seamless radar picture.
  • The Indian Coast Guard (ICG) will carry out regular Dornier sorties over the island nation to look out for suspicious movements or vessels. The Southern Naval Command will overlook the inclusion of Maldives into the Indian security grid.
  • Military teams from Maldives will visit the tri-services Andaman Nicobar Command (ANC) to observe how India manages security and surveillance of the critical island chain.
  • Ekuverin, an annual joint military exercise is held every year since 2009 between India and Maldives. The exercise aims to enhance the interoperability between the Indian Army and Maldives National Defence Force in order to effectively undertake counter-terrorism operations in urban or semi-urban environments.

Recent Issues/Problems:

Recent development in India-Maldives relation India and Maldives relations have seen many ups and During Maldivian Presidential elections in 2013 Abdulla Yameen defeated Mohamed Nasheed to become the President. During Yameen’s term, Maldives relations with India deteriorated while its closeness with China increased, which is highlighted by:

  • Cancellation of GMR project, 2012: Maldives annulled the $500 million contract with GMR Group to develop a modern International Airport near Male, which was later given to a Chinese company.
  • Maldives signed a new law permitting developers to own islands on lease for development and subsequently, a Chinese company took control of Feydhoo Finolhu, an uninhabited island close to Male and its international airport, on a development lease for 50 years.
  • Maldives endorsed China’s Belt and Road Initiative (BRI) and signed MoU on Maritime Silk Road, following which China has invested billions of dollars in Maldives building highways and housing as part of BRI.
  • China Maldives FTA, 2017: China and Maldives signed an FTA, which is China’s second FTA with a South Asian country after Pakistan, while there is no FTA between India and Maldives.
  • China has become an influential player in the Maldives, given its financial leverage over the country as an estimated 80 per cent of the Maldives’ total debt – equivalent to about 25 per cent of gross domestic product – is owed to China
  • 2018 During Pakistan’s Army Chief’s visit, Maldives announced joint patrolling with Pak Navy to guard Maldivian Exclusive Economic Zone, with an indirect reference to a perceived threat from India.
  • India’s ties with Maldives nose-dived after it criticised the Abdulla Yameen government for imposing a 45-day emergency earlier in 2018.
  • Maldives asked India to take back the two helicopters given to Maldives along with the training personnel who were there on the invitation of Maldivian Government.
  • Maldives denied work permits to nearly 2000 Indians working there, while no action was taken against thousands of Bangladeshis who were over staying beyond the work permit periods.
  • Terrorism and radicalization has increased as Maldives sent maximum number of terrorists per capita sent to ISIS. Maldives has good relations with Pakistan and Saudi Arabia.
  • Low bilateral trade:Bilateral trade between both, which stands at US $200 million annually, is quite low.

Improvement in relations

During all these negative developments in Maldives, India responded with patience and composure, trying to revive relations diplomatically. However, the election of Solih,in 2018, as new President of Maldives has caused a thaw in India Maldives relations which can be gauged by:

  • Despite opposition from Indian Ocean Rim Association, India convinced IORA Committee for Senior Officials in favour of Male, following which Maldives was inducted as the newest member of IORA recently.
  • Maldives has asked India for a Dornier aircraft and the MEA has responded positively to its request.
  • Maldives’ new government has decided to pull out of the free trade agreement (FTA) with China, realizing the one-sided nature of the FTA.
  • To help the Maldives address its budget deficit and development challenges, India has worked out a generous $1.4 billion assistance package which is key to helping Male break free of Beijing’s “debt-for-leverage” model of diplomacy.The massive debts the Maldives incurred, by some estimates to the tune of $3 billion, linked to infrastructure investments need to be unwound.
  • Conclusion of four agreements relating to cooperation for information technology, culture, agri-business, and visa arrangements
  • India’s Neighbourhood First Policy: India announced a financial assistance package of $1.4 billion for the Maldives in the form of budgetary support, currency swap agreements and concessional lines of credit to fulfill socio-economic development programmes.
  • Maldives’ India-First Policy: President Solih reaffirmed his government policy, and commitment to working together closely with India. He identified various areas for developmental cooperation, including private sector involvement in development of housing and infrastructure, water and sewerage systems in the outlying islands, healthcare, education and tourism.
  • Connectivity: emphasized the need to improve connectivity between the two countries through the establishment of enabling infrastructure that would promote the exchange of goods and services, information, ideas, culture and people.
  • Visa Facilitation Agreement: Recognizing the importance of facilitating people-to-people exchanges and travel, the two nations welcomed the new agreement on Visa Facilitation.
  • Indo-Pacific Region: The two leaders agreed on the importance of maintaining peace and security in the Indian Ocean Region.
  • Terrorism: The two leaders reaffirmed their unwavering commitment and support for increased cooperation in combating terrorism in all its forms and manifestations both within the region and elsewhere.
  • Global Issues:The two leaders reiterated the importance of an effective multilateral system as a key factor in tackling global challenges. They recognized the need to pursue reform of the main UN bodies, including the revitalization of the UN General Assembly and expansion of the UN Security Council.

Way Forward

  • The Maldives is strategically important, given its geographical location in the Indian Ocean. India must deploy a lighter diplomatic touch that focuses on enhancing natural affinities, to deal with this important nation in its neighbourhood.
  • The logic of geography dictates that India’s role will be critical in determining the trajectory of political developments in the Maldives.
  • Investment cooperationwith Maldives should be enhanced by establishing an advisory cell to guide all stake-holders i.e. Indian missions overseas and prospective Indian investors, to delineate touchy areas and risky investments, with full knowledge of the local conditions.
  • ‘Free-purse’policy of aidto Maldives is needed if India wants to offset Chinese big-ticket investments in Maldives.
  • India must enhance anti-terrorism cooperationand intensify cooperation in the areas of training and capacity building of the Maldives National Defense Force and the Maldives Police Service.
  • Commitment and support for increased cooperation in combating terrorism in all its forms and manifestations both within the region and elsewhere.
  • India needs to be mindful of timely delivery of projectsas it will be compared with Chinese who have timely delivered projects in Maldives.
  • A regular bilateral security dialogueamongst the officials of both sides should be instituted to expand the scope of security cooperation. This should be supplemented by Track-II and Track-1.5 dialogues.
  • While dealing with smaller neighbors like Maldives, India needs to become a lot more magnanimous, staying true to its own “Gujral doctrine,”thus creating greater confidence.
  • The SAARC and IORA can provide a platformto work on lingering concerns. Moreover, India, Maldives and Sri Lanka can explore ways to strengthen trilateral mechanisms to address these issues.
  • India must collaborate with like-minded countries like EU and USfor reducing Maldives’ dependence on China by strengthening the democratic institutions, like US committed a $ 10 million aid for training Maldivian military personnel recently.
  • Both countries can bolster each other’s security interests as they consolidate cooperation in the Indian Ocean Region (IOR). They have agreed to strengthen maritime security cooperation in the IOR through coordinated patrol and aerial surveillance, exchange of information and capacity building.
  • Enhance bilateral cooperation on issues of common concern, including piracy, terrorism, organized crime, drugs and human trafficking.
  • Enhancing bilateral cooperation in areas such fisheries development, tourism, transportation, connectivity, health, education, new and renewable energy and communications
  • In devising a smart action plan to implement the SAGAR, or Security and Growth for All in the Region, strategy, that was announced by Mr. Modi in March 2015, New Delhi should accord equal importance to its two key goals: address its neighbours’ concerns on security challenges; and harness enticing opportunities for the Blue Economy

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