India and the Maldives have taken significant steps to reset their diplomatic relations after the two were amidst a feud last year, highlighted by a US$400 million (₹3,000 crore) currency swap deal, after a strained year marked by two key diplomatic disputes. The visit of Maldives President Mohamed Muizzu to India played a pivotal role in this reset. The relationship had been strained due to critical comments from Maldivian ministers regarding Indian Prime Minister Narendra Modi and Muizzu’s election campaign, which was perceived as ‘pro-China’. It focused on removing Indian military personnel stationed in the Maldives.

Muizzu’s state visit began with a ceremonial reception in Delhi, followed by meetings with PM Modi, where both leaders emphasized the importance of cooperation. PM Modi reiterated India’s commitment to its ‘neighbourhood first’ policy, citing India’s role in aiding the Maldives during emergencies, including providing COVID-19 vaccines, essential supplies, and infrastructure development projects. During the visit, India officially opened the Honeymoon International Airport and highlighted projects such as housing units and water and sanitation facilities that benefit thousands of people across the Maldives. Moreover, the Indian budget for the FY 2024-2025, had allotted an investment of around ₹800 crore for the island country, which was around ₹400 crore in the budget of the previous year. 

Security in the Indian Ocean region was the main topic of discussion. Moizeo’s previous request for the withdrawal of 90 Indian soldiers was a source of tension, but the personnel have been replaced by technical personnel. India’s concern over China’s growing presence in the region, especially after Chinese research vessels landed in neighboring countries, was also acknowledged. 

India has announced a currency swap deal with an additional $100 million in bills to help the Maldives resolve currency issues and counter China’s influence. Other important announcements include the launch of India’s RuPay card in the Maldives and India’s support for infrastructure projects in the Great Dane region. This will significantly reduce the influence China has over Maldives, or at least that is the plan. Moreover, this will be a statement to China that India is always friendly with their neighboring countries, and this will help India determine China’s intention based on their next move.