The government of India has extended a financial package worth USD 250 million to the government of the Maldives.
The financial assistance was announced during a digital video conference held on August 13 between the Minister of Foreign Affairs of the Maldives Abdulla Shahid and Minister of External Affairs of India Dr. Subrahmanyam Jaishankar. The financial package was extended to support the Maldives in meeting the financing gap of the Maldives, and support the country’s efforts in responding to COVID-19.
Several other significant decisions on multiple initiatives were also made during the meeting. This included the announcement of the decision to establish an air bubble between the two countries. This is the first air bubble to be established in South Asia.
The foreign ministry stated regular scheduled flights will now commence between the two countries, enabling the further strengthening of the traditionally strong people-to-people contact. The ministry said relevant public health related requirements against COVID-19 will continue to be observed by both countries.
Minister Shahid thanked the Indian government for including the Maldives among the first countries with which India has established an air bubble. He emphasised the importance of easing travel, especially for Maldivians seeking to visit India for urgently required medical treatment, as well as Indian tourists wishing to visit the Maldives.
The meeting also reviewed progress on the ongoing development projects between the two countries. In this context, the two ministers acknowledged the good progress being made on the projects that are being considered under the USD 800 million Line of Credit.
The USD 800 million Line of Credit was announced during the state visit of President Ibrahim Mohamed Solih to India in December 2018, for which the agreement was signed between the Indian Export Import Bank and the Ministry of Finance in March 2019. Several key infrastructure projects are currently being considered for financing under the Line of Credit.
Both Ministers agreed to work towards further accelerating implementation on the key infrastructure projects. They also agreed on the significance of the smaller projects, which are being carried out under the Indian High Impact Community Development Projects Scheme, and the cash grant by the government of India. Nineteen projects in 74 inhabited islands, in eighteen atolls, have been approved for financing under the cash grant, and nine projects are being implemented under the High Impact Community Development Scheme.
Minister Jaishankar also confirmed the renewal of the quotas for the import of essential commodities from India to the Maldives. These essential commodities include rice, sugar, flour, onions, potatoes, eggs, dhal, stone aggregates and river sand. Minister Jaishankar further noted that the quota approved is larger than the amount approved last year, which he hoped would help ensure predictability of imports during this difficult time.
Minister Shahid thanked the government of India for renewing the quota for this year for all the essential commodities, and for the uninterrupted supply of essential items during the pandemic. He also acknowledged the special exemptions made for the Maldives in this regard.
The ministers also reflected on the sea links between the countries as a way to enhance trade and commerce, and welcomed the announcement that the cargo ferry service between Cochin, Kulhudhufushi-Male’ will be brought into operation within the next few months.
Minister Shahid thanked the Minister of External Affairs and the Government of India for the continued support for the development of the Maldives. He noted that India has been among the first to respond during this pandemic, as it has with every crisis the Maldives has faced.
On November 1 2020, the Maldives and India will celebrate 55 years since the establishment of formal diplomatic relations between the two countries. Both countries share traditionally strong and friendly ties, enjoy a strong developmental partnership, and vibrant people-to-people connections, nurtured by geographical proximity, ethnic, historic, socio-economic, and cultural ties.