Indian offers $25 million, aircraft to Maldives

New Delhi: India will give immediate assistance of US$ 25 million to the Maldives to ensure budgetary stability of its tiny maritime south-western neighbour, sources said on Tuesday, even as Maldivian foreign minister Abdulla Shahid said his country “can’t shy away from China”, adding that this was the “current reality”.

Emphasising the Maldives’ “India First” policy, the Maldivian foreign minister however pointed out that his country had “benefited” from Chinese “generosity” for the past 50 years and that the Maldives would continue to engage with China. Nevertheless, after the change of government in the archipelago nation, both India and the Maldives are the closest of friends once again.

“India will give immediate assistance of US$ 25 million to the Maldives (for budgetary stability). Other aspects of assistance are being worked out,” Indian government sources said on Tuesday. New Delhi is also ready to deliver a Dornier maritime surveillance aircraft to the Maldives.

It may be recalled that China had undertaken high-profile infrastructure projects in the archipelago nation during the tenure of former president Abdulla Yameen and the Maldives is now reportedly under a huge financial debt to China. The new Maldivian government under President  Ibrahim Mohamed Solih is currently examining just how much of foreign debt they owe to China.

Meanwhile, at a press conference on Tuesday afternoon, Maldivian foreign minister Shahid said, “China has been generous to us (Maldives). The country (Maldives) has benefited from the generosity of China for the last 50 years. The Maldives can’t shy away from China. This is the current reality. We will continue to engage with China.” Mr Shahid is also expected to visit China soon apart from the UAE, Saudi Arabia, and Japan.

The Maldives is, however, reviewing its Free Trade Agreement (FTA) with China. Mr Shahid said the new Maldivian government is “reviewing the FTA document”. He said the FTA document was “pushed through” Parliament during Mr. Yameen’s tenure.

Lambasting Mr Yameen whom he said tried to “play India against China”, Mr Shahid said Mr Yameen thought of himself as a “puppet-master” and India and China as “puppets” whom he could control. On the volume of debt owed to China, Mr Shahid said that Mr Yameen had objected to sharing with the Public Accounts Committee (PAC) of the Maldivian Parliament the amount of debt that the Maldives owed to foreign countries.  The Maldives is also seeking changes in the currency swap agreement with India for enhancement of reserves beyond US$ 200 million.

Asked about the menace of terrorism, Mr Shahid said it was a fact that some Maldivians had been involved in terrorist acts.