In a goodwill gesture, India on Thursday said it has decided to rollover a USD 50 million Treasury Bill for an additional year at the request of the Maldives government.
"At the request of the Government of Maldives, the State Bank of India (SBI) has subscribed the USD 50 mn Government Treasury Bill (T-bills) issued by the Ministry of Finance of Maldives, for a period of one more year from the date of maturity of the previous subscription, September 19, 2024," said the High Commission of India in Maldives in a press release.
The Treasury Bill had been purchased under an agreement signed by the previous administration, according to reports. SBI has purchased treasury bills amounting to USD 200 million at USD 50 million each, the news portal Adhadhu reported.
According to a Daily FT report, treasury bills were rolled over annually and interest paid by the government of India before it said the government of President Mohamed Muizzu offset USD 50 million in January this year as an austerity measure.
Maldives had sought Indian government to extend the deadline for repayment of the remaining USD 150 million. India agreed to rollover USD 50 million in May and a second USD 50 million payment was due today.
"Sincere gratitude to External Affairs Minister @DrSJaishankar and the Government of #India for extending crucial budgetary support to the Maldives with the rollover of USD 50 million Treasury Bill. This generous gesture reflects the enduring bonds of friendship between #Maldives and #India,": Foreign Minister Moosa Zameer said in a post on X on Thursday.
Earlier this month in May 2024, the SBI had made a similar subscription of USD 50 mn T-bills under the same mechanism again at the request of the Government of Maldives.
The Foreign Ministry Thursday thanked the "generous support that the Government of India has been providing to the Maldives in the form of budgetary support."
"This extension is coming at a critical time when the Government of Maldives is undertaking a rigorous fiscal consolidation program to address the pressing economic challenges," it said.
The move comes just days after Foreign Minister Zameer acknowledged that the Maldives-India ties witnessed rough patches in the initial days of President Muizzu-led government but insisted the two countries have resolved the "misunderstandings".
Tensions over India's ties with the Maldives grew since Muizzu, known for his pro-China orientations, assumed office as President. He, within hours of his oath, sought the withdrawal of Indian military personnel deployed to man three aviation platforms gifted by India to the Maldives. The Indian military personnel were replaced by civilians in talks between the two sides.
Unlike his predecessors, who made the first port of call to New Delhi after assuming office, Muizzu travelled to Turkiye first and to China for his first state visit in January. He visited New Delhi on June 9 to attend Prime Minister Modi's swearing-in ceremony.
Muizzu will travel to India on an official visit "very soon," his spokesperson said last week.
The other governments are also trying to delay the loan repayment, including that from China. Both China and India are prominent sources of foreign debt for Maldives. Government debt servicing stands at USD 409 million in this year, further stressing its thin foreign currency reserves.
Usable reserves of Maldives have increased to USD 444 million with usable reserves at USD 61 million.
Read also| Saudi Crown Prince: No Diplomatic Relations with Israel Without Palestinian State
Read also| Russia Extends Ban on Western Food Imports for Another 2 Years
