Maldives President Muizzu Thanks India For Support To Strengthen His Country’s Fragile Economy
China and india provide the most assistance in repaying the country’s debt, President Muizzu said on friday at an official function held to mark the 59th anniversary of the country’s independence. “I thank the Chinese government and the indian government on behalf of the Maldivian people for their cooperation with this effort to strengthen the economy, to assure our economic sovereignty, for the sake of the Maldivian people,”
He also praised Rs 400 crore assistance by india and sought to restructure debt owed to india by Maldives. The marked change in his policy towards india came as in May this year the international Monetary Fund (IMF) warned the maldives that it data-faces a high risk of debt distress without significant policy changes.
The IMF noted that the Maldives’ current account deficit is expected to remain large and that its overall fiscal deficits and public debt are projected to stay elevated. Following this, the Muizzu government sought the restructuring of loans from China. maldives debt to china reportedly amounted to over USD 1.3 billion about which beijing initially expressed reservations to restructure the debt.
A large portion of the loans taken by the maldives from China’s Exim bank for development projects during former president Yameen’s government must be repaid in 2026, according to adhadhu.com report. The maldives will data-face a serious fiscal crisis if the loans are not restructured. Technical work on restructuring the loans taken from China’s Exim bank is ongoing, which was how President Muizzu believed that “foreign policy should be shaped to protect the country’s independence,” the report said.