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Home / Politics / News /  India announces $500 million for major connectivity project in Maldives

NEW DELHI : Indian foreign minister S Jaishankar on Thursday said India will finance a major connectivity project in Maldives through a $400 million line of credit and $100 million grant after talks with his Maldivian counterpart Abdulla Shahid.

The 6.7 km Greater Malé Connectivity Project (GMCP) will be the largest civilian infrastructure project in Maldives, connecting Malé with three neighbouring islands -- Villingili, Gulhifahu and Thilafushi, officials said.

People familiar with the GMCP pointed out that its implementation was a key election promise of the ruling MDP for which the President of Maldives Ibrahim Mohamed Solih had sought India’s assistance during a meeting with Jaishankar in September.

"India will fund the implementation of Greater Malé Connectivity Project through a $ 400 mn LOC & $ 100 mn grant. This 6.7 km bridge project connecting Malé with Gulhifalhu Port & Thilafushi industrial zone will help revitalise and transform Maldivian economy," Jaishankar said in a Twitter post.

He also announced the start of regular cargo ferry service between India and Maldives to boost trade and commerce between the two countries.

"We're also starting an air travel bubble with Maldives to sustain and promote the dynamic people-to-people ties between the two countries," he added.

Since the election of Ibrahim Mohamed Solih as the president of the Maldives in 2018, India has been working over time to keep the Maldives within its sphere of influence. Solih’s predecessor Abdullah Yameen was seen as close to China, something that kept India wary.

The Indian foreign ministry in a statement on Thursday said “once completed, this (GMCP) landmark project will streamline connectivity between the four islands, thereby boosting economic activity, generating employment and promoting holistic urban development in the Malé region."

India is also extending financial support for construction of a port in Gulhifahu.

On the ferry service, Jaishankar said its significance lay in enhancing bilateral trade and connectivity and in further boosting the economic partnership between the two countries.

"The cargo ferry service will enhance sea connectivity and provide predictability in supplies for importers in Maldives and exporters in India. It will also reduce logistics costs and times for traders," the Indian foreign ministry statement said.

Referring to creation of an air bubble, it said Maldives is the first neighboring country with which an air bubble is being operationalised.

"The air bubble symbolises India’s support to shore up tourism arrivals and revenues in the Maldives. Health protocols in both countries will be strictly followed. The first flight under the Air Bubble is expected to commence on August 18," the statement said.

In the meeting, Jaishankar also conveyed to Maldivian foreign minister Shahid India's decision to renew quotas for supply of essential commodities to Maldives for the year 2020-21.

"The commodities include food items like potatoes, onions, rice, wheat, flour, sugar, dal and eggs as well as river sand and stone aggregates. The quotas assure food security, and the supply of essential construction items, and thereby provide certainty and price stability for such essential items in the Maldives," the foreign ministry statement said.

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