India signs $400 million loan pact with Maldives for mega connectivity project
India on Monday signed a $400 million (over Rs 3,000 crore) loan pact with Maldives for a mega connectivity project that will dwarf the Maldives-China Friendship Bridge as the most visible infra-project in the island country.
Once implemented GMCP will render the Chinese project “insignificant’’ in comparison.
It will also help showcase India’s expertise in conceptualising and implementing a complex infrastructural project, sources had said when External Affairs Minister S Jaishankar made the announcement during a video call with his Maldivian counterpart Abdullah Shahid.
The line of credit (LOC) was signed by Exim Bank’s Nirmit Ved and Maldives Finance Minister Ibrahim Ameer on Monday. The Exim Bank has now provided three LOCs to Maldives totalling $1.2 billion (about Rs 10,000 crore) as India provides generous assistance after a turnaround in ties following a change of government in Male.
Projects covered under other LOCs relate to water and sewerage, island development, a cricket stadium, a port, an airport and a road. India’s credit lines and grants to Maldives stand at over $2 billion (Rs 15,000 crore), all announced after Ibrahim Solih became President in November 2018.
India had recently completed the Supreme Court building in Mauritius, another Indian Ocean island-country with which it has intensified diplomatic ties.
Maldives has received 5.5 tonnes of essential medicines from India which also helped in evacuation of Maldivians from Wuhan and deployed a medical team.
India has gone the extra mile to help Maldives financially through a transparent mechanism. The RBI raised Treasury Bonds which were sold to the State Bank of India (SBI), Male, for handover to the Maldives government.
After the Galwan Valley clash, not only has India stepped up aid but welcomed the US signing a defence framework agreement with the Maldives.
Just seven years back, it had strongly opposed a proposed US security partnership with the Maldives. The then government had felt American entry in Maldives would give rise to misgivings at a time when it thought India and China could co-exist in the Indian Ocean.
Earlier, the Indira Gandhi-government had kicked up a row when the US sought to renew lease on a Sri Lankan transmitter. Located in Trincomalee, New Delhi thought the CIA also used it for intelligence gathering.
No such reservations now remain after India and China clashed violently in Galwan Valley on June 15 this year, said sources.