India Supports Maldives with ₹30 Billion Currency Swap Facility Under SAARC Framework

India has extended financial support to the Maldives through a currency swap arrangement, reinforcing its role as a key economic partner in the region. 

Swap Facility and Agreement Details 

As per ANI report, the ₹30 billion facility has been approved under the INR Swap Window of the SAARC Currency Swap Framework for the period 2024–2027.  

The arrangement was formalised between the Reserve Bank of India and the Maldives Monetary Authority during the October 2024 state visit of President Mohamed Muizzu to New Delhi. 

The approval was announced by the Indian High Commission in Male, highlighting the continued financial cooperation between the two countries. 

Parallel Repayment and Financial Commitment 

On the same day as the approval, the Maldives settled a $400 million swap facility that it had availed in October 2024 under the US Dollar/Euro Swap Window of the bilateral agreement.  

The repayment reflects the country’s commitment to meeting its financial obligations, as stated by its foreign ministry. 

Purpose and Economic Impact 

The INR swap facility is aimed at strengthening the Maldives’ macroeconomic stability by providing access to foreign exchange during periods of liquidity stress.  

It is expected to support the country in managing balance-of-payment pressures, stabilising foreign exchange reserves and ensuring smooth external payments. 

Officials in Male indicated that the funding would provide immediate relief to reserves and help maintain investor confidence amid global uncertainties, including geopolitical tensions in West Asia. 

Historical Support and Strategic Context 

Since the introduction of the SAARC swap framework in 2012, the RBI has extended cumulative support of about $1.1 billion to the Maldives.  

The arrangement has become a key financial tool for the island nation, especially during periods of external economic stress. 

The initiative aligns with India’s broader regional engagement strategies, including its Neighbourhood First policy and Vision MAHASAGAR, under which the Maldives remains an important partner. Indian authorities reiterated their position as a reliable first responder in times of need. 

Read More: India Fiscal Deficit May Rise Beyond Target to 4.5% in FY27: Fitch Report! 

Conclusion 

The latest swap approval reflects continued financial cooperation between India and the Maldives, supporting economic stability while strengthening bilateral and regional ties in a period of global uncertainty. 

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