Maldives Enhances Ties With China In Strategic Shift From India

During newly elected President Mohamed Muizzu's first state visit to Beijing on Wednesday, the relationship between China and the Maldives was upgraded. In the Great Hall of the People, Chinese President Xi Jinping referred to Muizzu as "an old friend," setting the stage for further investment in the Indian Ocean archipelago. A "comprehensive strategic cooperative partnership" was agreed upon by the Asian giant.

According to Chinese state media, the relationship between the two countries has an opportunity to carry forward the past and forge ahead into the future. This statement comes from the Chinese president Xi during the official meeting with Muizzu.

India, China and Maldives conundrum

In November, President Mohamed Muizzu, who won the "India Out" campaign platform, assumed office in the Maldives. Under this platform, he perceived New Delhi's significant influence as a threat to sovereignty, reported Reuters. Despite being heavily indebted to Beijing, Muizzu's government has asked numerous locally based Indian military personnel to leave while emphasizing opportunities for Chinese investors.

The relationship between India and China soured after a clash in the western Himalayas in June 2020, leading to the death of 20 Indian soldiers. By upgrading ties with the Maldives, China is paving the way for increased investment in a region where another neighbour, Sri Lanka, has already aligned itself with China, as per a Reuters report.

During the talks, President Dr Muizzu expressed gratitude for "China's significant role in the Maldives' economic success... and infrastructure development," read a statement from his presidential office following the meeting. It added that "20 key agreements between the two countries" had been signed.

China, with a debt of $1.37 billion, constituting about 20% of its public debt, is the Maldives' largest bilateral creditor, surpassing Saudi Arabia and India, to which it owes $124 million and $123 million, respectively. Since joining the Belt and Road Initiative in 2014, Chinese firms have invested an additional $1.37 billion in the Maldives, according to Reuters citing data from the American Enterprise Institute think tank.

State media reported Xi as saying that China firmly supports the Maldives in safeguarding its national sovereignty, independence, and national dignity. Beijing is also willing to exchange governance experiences with Males. Ahead of the meeting with Xi, Muizzu was given a tour of the Chinese Communist Party Museum in Beijing.

In October, a World Bank development report on the Maldives warned that further alignment with China could pose challenges due to a "build-up of sovereign exposure" during the pandemic and a "lack of domestic investment opportunities." Xi expressed support for increasing the number of direct flights between the two countries, potentially benefiting the Maldives' travel and tourism sector, which constituted 79% of economic growth in 2022, according to the Asian Development Bank.