*Arshad Khan – India
India Maldives relations
Maldives is a tiny country consisting of 1,192 coral islands in the Indian Ocean. Its considered tourism center for upper middle and rich class tourist around the world. Maldives has 98.7 % muslim population. Tourism accounts for 28% of the GDP and more than 60% of the Maldives’ foreign exchange receipts. Over 90% of government tax revenue comes from import duties and tourism-related taxes. Global east-west shipping lanes pass the nation’s chain of 1,192 tiny coral islands, stretching around 800 kilometres (500 miles) across the equator. Recently it was in the news regarding its relations with India.
Comments which provoke the Indian media
Malsha Shareef, Mariyam Shiuna and Abdulla Mahzoom Majid who all worked for the Ministry of Youth Empowerment, Information and Arts were disciplined for their comments against Modi on social media, a senior government official told Reuters on Sunday.
The three had variously described Modi as a “clown”, “terrorist” and “puppet of Israel” on social media platform X, in response to a video of promoting tourism in Lakshadweep, an Indian Union territory in the Arabian Sea.
EaseMyTrip, one of India’s largest online travel platforms, has said that it would no longer be accepting any bookings for the Maldives. Meanwhile, STIC Travel Group—one of the country’s biggest tourism companies—encouraged tour agencies and airlines to steer clear of travel to the Maldives, Bloomberg reported.
Political background
In April 2019 parliamentary election The Maldivian Democratic Party (MDP) of president Ibrahim Mohamed Solih won a landslide victory. It took 65 of 87 seats of the parliament. He was considered close to India
In the presidential elections of 2023 Mohamed Muizzu, an engineer-turned-politician, won the elections with 54% votes. Muizzu came to power riding on the Opposition’s ‘India Out’ campaign, and defeated President Ibu Solih who was viewed as friendly to India.
A day after he was sworn in as President of Maldives, Mohamed Muizzu on Ovember 18 last year “formally requested” the Indian government to “withdraw its military personnel” from the island nation.
The strategic location of the island nation is another point of significance for India. With its proximity to the west coast of India, Maldives is one of the key elements in India’s maritime security calculus.
According to a New York Times report, India is now working on significant infrastructure projects in the Maldives that neither party wants to cancel.
Muizzu’s China visit
Besides, the expanding Chinese footprint is a matter of concern for India. On Wednesday, Chinese President Xi Jinping held talks with his Maldivian counterpart Mohamed Muizzu following which the two countries signed 20 key agreements, including one on tourism cooperation, and elevated their bilateral ties to a comprehensive strategic cooperative partnership.
The agreements signed included one tourism cooperation, disaster risk reduction, blue economy, strengthening investment in the digital economy and the Belt and Road Initiative.
The agreements also included jointly accelerating the formulation of the Cooperation Plan on the Belt and Road Initiative, social housing project on Fushidhiggaru Falhu, fisheries products processing factories and the re-development of Male’ and Villimale’ Roads Development Projects.
Meanwhile, Maldivian media reported that the two countries have signed a USD 50 million project to develop an integrated tourism zone on the Indian Ocean island, PTI reported.
China’s bilateral trade in 2022 totalled $451.29 million of which China’s exports constituted $451.29 million against $60,000 of exports from the Maldives. Muizzu also sought investments from Chinese companies for 11 projects at the Maldives Investment Forum.
Xi “stressed that China respects and supports the Maldives in exploring a development path suited to its national conditions”, it added, and “supports the Maldives firmly in safeguarding its national sovereignty, independence, territorial integrity and national dignity”.
Foreign Investments & Debts
The Maldives owes China $1.37 billion, or around 20% of its public debt, according to World Bank data, making Beijing its biggest bilateral creditor ahead of Saudi Arabia and India, which it owes $124 million and $123 million, respectively. Chinese firms have invested a further $1.37 billion in the Maldives since its decision to join the Belt and Road Initiative in 2014, data from the American Enterprise Institute think tank shows.
Tourism – main source of income
Tourism is considered as main component of Maldives GDP constituting around 15% of total GDP revenues. China & India are among the top customers for the industry. Though China’s tourist declined post covid, but now they are picking up. Xi said he backed increasing the number of direct flights between the two countries, in a potential boon for the Maldives’ travel and tourism sector, which constituted 79% of economic growth in 2022, according to the Asian Development Bank.
Trading Partners
India and China continue to be a major trading partners of Maldives, both taking priorities based on the government inclination of Ibrahim & his opponents. With the new government’s inclination towards China, it is expected to increase its share on the expense of India.
Muizzu’s Turkiye visit
The new president has surprised many with his maiden visit post the elections to Turkiye; which was well noted in many influential circles. Maldives and Turkiye have signed a trade and economic cooperation pact in a bid to expand cooperation between the two Islamic nations, according to a statement from the Maldives’ President’s office on Monday.
The pact was signed following official talks between Maldives’ new President Mohamed Muizzu and Turkiye’s President Recep Tayyip Erdogan, which took place at the Presidential Palace in Ankara. The two leaders said that they would like to expand cooperation in trade and investment, renewable energy, higher education and other areas.
Future strategic importance
With the development of multi polar world, the importance of strategic maritime routes and destinations are going to be of prime importance. With the paradigm shift of Maldives from India towards China and Turkiye provides lot of opportunities in the coming years. Will that continue for a long time or will change with every elections and change in ruling party, time will tell.
Note: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of South Asia Strategic Research Center (GASAM)
