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November 28, 2018

India will help cash-starved Maldives make up its budget deficit


Highlights
  • Maldivian foreign minister announced that Male's 'India First' policy is back on track
  • “President Yameen tried to be a puppet master, to play India and China off against each other. He failed. We have a strong India first policy, but will engage with all other countries,” he said
  • He said his government would decide on the free trade pact with China after a full review
India will help Maldives make up its budget deficit as immediate assistance to the cash strapped government. This was announced by Maldivian foreign minister Abdullah Shahid after his meetings with the Indian leadership.

Announcing that Maldives’ ‘India First’ policy was back on track, Shahid told reporters that the Ibrahim Solih government would undertake a review of the debt obligations by the Maldives to different countries, but mainly to China. “President Yameen tried to be a puppet master, to play India and China off against each other. He failed. We have a strong India first policy, but will engage with all other countries,” Shahid said.

Describing India as a time-tested and trusted partner, he said the government would decide on the free trade agreement with China after a full review. “The FTA was rushed through parliament. The parliamentary committee reviewed a 1,000-page document in 10 minutes and passed it. We were in the opposition then, we did not get a chance to look at it,” Shahid said.

However, he was clear that Maldives saw China as a friend, as one of the largest economies of the world whose assistance had benefited Maldives.

Maldivian finance minister Ibrahim Ameer said he believed some Chinese projects were taken at an “inflated” price but there was no scope of renegotiating them.

He added that the government was yet to fully assess the quantum of debt owed to China because most of the deals had been done in secret and there were no public accounts.

Shahid said he would be travelling to the UAE, Saudi Arabia, Japan, China and The EU to revive engagement and look for aid.

He confirmed that there was no question of returning the advanced light helicopters to India, as threatened by Yameen.

Minister for economic development Fayyaz Ismail said Maldives had asked India to extend an existing currency swap agreement to six months from the present three months, and increase the amount from the current $200 million. He added, “We are looking to India to lead the IHavan project.” IHavan is a special economic zone and transshipment port in a strategically located northern atoll on the Indian Ocean’s busiest route. This is significant since Yameen had blocked all Indian attempts to participate in IHavan, instead looking to China.

Ismail told another group of reporters, “We are trying to put the past last five years of instability in the Maldives and we will try to resolve all differences between Maldivian and Indian investors. In that regard, we are hoping to strengthen our bilateral trade. We are hoping to enter into a bilateral treaty with India on increasing investment.”

timesofindia

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