India’s Rs 30bn swap aid to Maldives receives approval, deepening bilateral ties

The Ministry of External Affairs confirmed on 16 October that India has approved the Maldives' request to prolong a Rs 30 billion currency‑swap facility. The decision reflects India’s strategic intent to bolster relationships with its island neighbours under the neighbour‑first doctrine. The swap deal, concluded during President Mohamed Muizzu’s October 2024 visit, was originally set up under the SAR‑C arrangement between the RBI and the Maldives Monetary Authority. An initial tranche of Rs 30 billion was transferred on 23 April 2024, giving the Maldives immediate rupee liquidity. The extended agreement, covering 2024‑27, carries preferential interest rates and additional financing options. Since 2012, India’s central bank has supplied over $1.1 billion in swap assistance to the Maldives. Moreover, India has invested in Maldivian sovereign debt, purchasing $250 million and $100 million long‑term treasury bonds and settling three $150 million treasury bills, for which it paid $42.8 million in interest. These steps are part of a broader economic and maritime partnership that aims to enhance stability and growth across the Indian Ocean.