Male: India and Maldives on Friday announced the launch of negotiations for a Free Trade Agreement (IMFTA), marking a new chapter in bilateral economic engagement. The announcement came during a joint press conference in Male, where Prime Minister Narendra Modi met Maldivian President Mohamed Muizzu.

Muizzu said, "I am also pleased to announce the initiation of negotiations for a free trade agreement between India and the Maldives. This landmark initiative marks a significant step forward in strengthening our economic partnership."

Wide-ranging discussions held between the leaders

The two leaders held one-on-one talks and delegation-level discussions covering trade, defence and infrastructure. Both sides exchanged multiple Memorandums of Understanding (MoUs) in the presence of the leaders.

Muizzu said, "The Prime Minister's visit coincides with two cherished occasions. Tomorrow, PM Modi will join me in the 60th Independence Day celebrations of the Maldives. Today, we have jointly released a commemorative stamp to mark the 60th anniversary of the establishment of formal diplomatic relations between the Maldives and India. This afternoon, Prime Minister Modi and I had extensive discussions."

Line of Credit and priority projects announced

Among the agreements was a significant Line of Credit deal amounting to USD 565 million. Muizzu stated that the funds from these MoUs will support priority projects of the Maldivian government.

"Prime Minister Modi and I had the honour of witnessing the signing of four MoUs and three agreements on several key areas. Among these is a line of credit agreement for USD565 million. This will be utilised for priority projects of my government across key sectors," he said.

India has extended the total Line of Credit to Rs 4,850 crores. Additionally, the annual debt repayment obligations of the Maldives on Government of India-funded LoCs have been reduced.

Infrastructure and defence cooperation deepens

Several handovers and inaugurations took place, signalling India’s continued developmental support. These included:

  • Handing over of 3,300 social housing units in Hulhumale under India’s Buyers' Credit facilities
  • Inauguration of Roads and Drainage System Project in Addu City
  • Launch of six High Impact Community Development Projects
  • Handing over of 72 vehicles and other equipment
  • Provision of 72 heavy vehicles to the Maldivian Ministry of Defence

The visit and resulting agreements reflect a renewed focus on strengthening the strategic and economic partnership between India and Maldives.