India has extended fresh financial support to the Maldives through a new drawdown under its currency swap arrangement, providing USD 319 million at a time when an earlier facility has reached maturity.
The funding, equivalent to INR 30 billion, has been made available under the SAARC Currency Swap Framework, following the expiry of a USD 400 million drawal accessed by the Maldives in October 2024. That earlier facility matured on 23 April 2026, effectively requiring either repayment or replacement, making the new drawdown a continuation of liquidity support rather than an additional inflow.
The arrangement falls under a broader agreement between the Reserve Bank of India and the Government of Maldives, concluded during President Dr Mohamed Muizzu’s state visit to India in October 2024. The current framework, covering the period from 2024 to 2027, includes more favourable terms compared to earlier arrangements, particularly in relation to interest rates and associated conditions.
Currency swap facilities have played a recurring role in supporting the Maldives’ external position. Since the SAARC framework was introduced in 2012, India has extended a cumulative USD 1.1 billion in swap support to the country. These instruments are typically used to ease short-term foreign exchange pressures, allowing the central bank to access liquidity without immediately drawing down reserves.
Alongside the swap arrangement, India has also provided additional forms of financial assistance. In 2025, USD 100 million in Maldivian Treasury bills held by India were rolled over, offering temporary relief to the government’s financing requirements.
The latest drawdown reflects a pattern of ongoing financial engagement between the two countries, particularly during periods of external vulnerability. While such facilities help manage immediate liquidity needs, they also highlight the Maldives’ continued reliance on bilateral support to stabilise its foreign exchange position.
India has framed the assistance within its broader regional policy approach, identifying the Maldives as a key partner under its Neighbourhood First policy and Vision MAHASAGAR.
