India has reaffirmed its support for the Maldives by providing critical financial help amidst the island nation’s ongoing debt crisis. On Monday, the Indian government confirmed the extension of its $50 million subscription to a treasury bill issued by the Maldives’ Ministry of Finance for another year. The decision was taken at the Maldivian government’s formal request and enabled by the State Bank of India, according to a statement released by the Indian High Commission in Male on X.
The Maldives’ Foreign Minister, Abdulla Khaleel, officially expressed gratitude to India, calling the assistance “crucial and timely.” He also stated that this financial lifeline would help the government’s efforts to drive fiscal reforms and boost the country’s economic resilience.
The Maldives’ economy is weak, with dwindling foreign exchange reserves and an increasing external debt burden. According to the World Bank, the island nation’s total public and publicly guaranteed debt would reach $9.4 billion by the end of 2024, exceeding 134% of its GDP—a more than $1 billion rise from the previous year.
Complicating matters, credit rating agencies Fitch and Moody’s downgraded the government in late 2024, limiting its access to international financing.
