Despite an ambitious Public Sector Investment Programme (PSIP) budget of MVR 12.4 billion for the year, only MVR 1.13 billion had been spent as of 15 May 2025, raising questions about the pace of project execution and the government’s ability to translate plans into tangible outcomes.
According to the latest Weekly Fiscal Developments report by the Ministry of Finance, the Maldives has utilised just 9% of its PSIP budget over the first four and a half months of the year. The PSIP covers infrastructure projects promised in the government’s manifesto or long-term development plans, ranging from transport and environmental protection to health services and housing.
Transport remains the largest budgeted function under PSIP at MVR 4.17 billion, yet only MVR 567 million has been spent so far. The housing and infrastructure sector, which has an allocation of MVR 1.8 billion, has seen just MVR 66 million in actual spending. In the education sector, spending stands at MVR 35.7 million out of a budget of MVR 517 million, while the health sector has used only MVR 37.4 million of its MVR 964.3 million budget.
Environmental protection, often cited as a government priority, is also facing similar under-execution. Of the MVR 1.54 billion allocated, only MVR 141.5 million has been utilised. Sub-categories like renewable energy, waste management, and coastal protection remain far behind schedule in terms of disbursement.
In contrast, recurrent spending continues to dominate the fiscal landscape, with over MVR 11.8 billion already spent, nearly ten times the amount allocated to capital projects in the same period.
The gap between approved budgets and actual spending has long been a structural issue in the Maldives, but the current shortfall is especially stark given the country’s emphasis on decentralised development and infrastructure-led growth. The reasons range from procurement delays and administrative bottlenecks to lack of readiness at the council level for implementing regionally distributed projects.
The Ministry of Finance has previously noted that weekly expenditure figures reflect posted transactions rather than cash settlements, indicating there may be additional lag in disbursements. However, with nearly half the year approaching, the low utilisation signals more than just accounting delays.
As infrastructure and development commitments mount, the growing disconnect between plans and implementation could strain public expectations, particularly in outer atolls that have long called for more equitable distribution of state investment.
