Bilateral trade between India and the Maldives has registered a more than 3-fold jump over the past seven years from $223 million in 2017–18 to $680 million in 2024–25, according to official figures.

India’s exports to the Maldives rose from $217 million in FY 2017-18 to $561 million in FY 2024-25, while imports from the Maldives expanded from $6 million to $119 million during the same period.

The trade between the two countries is expected to increase further with Prime Minister Narendra Modi announcing a Rs 4,850 crore line of credit to the Maldives during his recent visit to the island nation last month. Additionally, PM Modi announced that discussions for a free trade agreement have also started between the two countries.

India has decided to promote renewable energy in the Maldives and will share its experience in this sector with the Indian Ocean neighbour.

PM Modi visited the Maldives at the invitation of President Mohamed Muizzu and attended the country's 60th Independence Day celebrations as the Guest of Honour. This also represented a turnaround in relations with the Muizzu government, which came to power in 2023.

The turnaround in the bilateral ties assumes significance as President Muizzu, known to be close to China, was known for his anti-India rhetoric while in the opposition as part of his political strategy to oust the earlier government.

The Maldives is one of India's key maritime neighbours in the Indian Ocean Region, and the overall bilateral ties, including in areas of defence and security, witnessed an upward trajectory under the previous governments in Male.

This sentiment is embedded in India’s Neighbourhood First policy and the MAHASAGAR vision, which recognises that the security and prosperity of the region are inseparable.

India’s approach is grounded in the belief that small island nations are not peripheral actors in global affairs but are frontline states in the fight against climate change, guardians of critical sea lanes, and partners in maritime security. The Maldives, straddling vital shipping routes, occupies a central place in India’s Indian Ocean strategy.