By News 
India and Maldives today signed a bilateral currency swap agreement worth USD 400 million and a separate Indian Rupees 30 billion facility that would help the Indian Ocean island nation overcome the foreign exchange reserve crunch.
The agreement was signed as Indian Prime Minister Narendra Modi and visiting Maldivian President Mohd Muizzu held talks at the Hyderabad House in New Delhi.
The State Bank of India rolled over the Treasury Bills it subscribed to in May and September of this year for an additional one-year period. This action provided much-needed financial support to the Maldives, helping to address its urgent financing and foreign exchange needs.
Modi and Muizzu, who is on his first state visit to India after coming to power on an “India out campaign” in September last year, held talks, jointly inaugurated the new runway at the Hanimadhoo International Airport and agreed to further strengthen bilateral relations lifting them from a rocky patch last year.
Modi said India and Maldives have decided to start discussions on the Free Trade Agreement to further strengthen economic ties.
After the Modi-Muizzu talks at the Hyderabad House in New Delhi, India also handed over 700 social housing units to the Maldives built under the EXIM Bank’s buyer’s credit facilities.
“Today, we have inaugurated the redeveloped Hanimaadhoo Airport. Now, the Greater Male Connectivity Project will also be expedited. We will also support the development of a new commercial port in the Maldives,” Modi said at a joint media appearance with Muizzu.
The Indian PM described Maldives as a “close friend” which had an important place in India’s neighbourhood policy.
“India has always fulfilled the responsibilities of a neighbour. Today, we have taken up the vision of a comprehensive economic and maritime security partnership to give our mutual cooperation a strategic direction,” Modi said.
The two countries agreed to strengthen their defence and security partnership with India supporting the Maldives with the provisioning of defence platforms and assets to augment the capabilities of the Maldivian National Defence Force (MNDF) as well as that of the government of Maldives in advancing its maritime and security requirements in line with its national priorities.
It was also agreed that India will support the Maldives in enhancing the surveillance and monitoring capability of MNDF with the provisioning of radar systems and other equipment.
They also agreed to enhance the capacity building and training slots for MNDF, Maldives Police Services (MPS) and other security organizations of Maldives under the ITEC programmes and other customized training programmes in India and to extend financial assistance to develop and upgrade MNDF infrastructure.
Earlier in the day, Muizzu was accorded a ceremonial welcome at the Rashtrapati Bhawan by President Droupadi Murmu. Prime Minister Modi was also present on the occasion. Muizzu was given a tri-services guard of honour before he drove down the Rajghat to offer his respects at the memorial to Mahatma Gandhi.
The ties between India and the Maldives came under severe strain since Muizzu, known for his pro-China leanings, took charge of the top office in November.
Muizzu won the presidential election last year on the ‘India out’ campaign and asked New Delhi to withdraw its 80-odd military personnel posted in the archipelago nation by May this year.
However, Muizzu has since toned down his anti-India stance and even sacked two of his ministers who were critical of the Indian prime minister as his government faced financial crisis and the relationship has been on the mend following diplomatic talks and meetings since.
As the Maldives was grappling with a serious economic downturn, India has decided to extend vital budgetary support to the Maldives government with the rollover of a USD 50 million Treasury Bill for another year, after a request by Muizzu.
Muzzu today said “India is a key partner in the socio-economic and infrastructure development of the Maldives and has stood by the Maldives during our times of need.”
Modi said India was willing to provide extensive help to the Maldives to develop infrastructure.