Are India and Maldives heading for diplomatic reboot?

Maldives President Mohamed Muizzu, who won his office last year on an "India Out" campaign, is preparing for a diplomatic trip to New Delhi, his aides say.

"The President is scheduled to visit India very soon. As you are aware, such trips are scheduled for a time of maximum convenience to leaders of the two countries. Discussions regarding this are in progress," said Heena Waleed, chief spokesperson at the President's Office in the capital Male last week.

India and the Maldives have traditionally maintained close ties. In recent years, however, China has been seeking to expand its presence in the Maldives with Muizzu urging a partnership with Beijing.

Threats of boycott over mockery of Modi

In April this year, Muizzu's government ordered India to withdraw a small force which had been deployed to help operate reconnaissance aircraft provided by India. In May, the Maldives signed a defense deal with China.

Also, the Maldives decided not to renew a 2019 agreement with India on a hydrographic survey and, earlier this year, Maldivian deputy ministers were caught making derogatory statements about Indian Prime Minister Narendra Modi over his plan to promote tourism in the nearby Indian archipelago of Lakshadweep.

Indian tourists responded with calls to boycott the Maldives — a serious threat for its tourism-dependent economy. But Muizzu remained defiant, denouncing attempts to "bully" his country.

Muizzu's 'pro-China bias'

Following a chill in relations, the planned visit by President Muizzu could mark a dramatic turnaround and signal the desire to mend fences.

Shanthie Mariet D'Souza, the head of independent research forum  Mantraya, told DW that Muizzu's government has seemingly done some reality checks about the benefits it can garner from favourable relations with India.

"It is too early to call it a policy reversal, but it certainly is a positive development in India-Maldives bilateral relations," D'Souza said.

She pointed out that Maldives is pursuing a balance of power in its foreign policy approach and aims to benefit from its relations with both India and China.

"The resignation of two junior ministers who had mocked Modi's promotion of Lakshadweep as an attractive tourist destination is a signal that Muizzu wants to maintain healthy relations with New Delhi. But that is unlikely to be at the cost of his pro-China bias," D'Souza added.

Money troubles in island paradise

The Maldives are in need of friends abroad. The resort nation faces increasing debt, low revenue, and depleting foreign reserves. The country has run on a budget deficit, while seeking assistance and grants.

In a statement last week, credit ratings agency Moody's downgraded the Maldives based on an assessment that "default risks have risen materially,” as foreign exchange reserves — have remained low. The agency said the prospects for a sharp recovery are relatively dim.

And despite the ongoing row, New Delhi is also keen to stop Muizzu's government from drifting more closely to Beijing. India is no stranger to providing financial aid to the Maldives, including a $100 million (€91.17 million) tranche in November 2022.

India says Maldives 'a priority'

Even before the announcement about the upcoming visit, both Male and New Delhi have signaled desire to improve ties. Last month, India's Foreign Minister S Jaishankar visited Male, marking the first high-level visit since Muizzu was elected.

"To put it succinctly in the words of Prime Minister Narendra Modi, for India, neighbourhood is a priority and, in the neighbourhood, the Maldives is a priority. We also share the closest bonds of history and kinship," Jaishankar said at the time.

Jaishankar's visit was followed by the two countries holding consultation on joint defense project and security in the Indian Ocean this month.

"Muizzu's government has softened its stand on India even while not altering its pro-China position," P Sahadevan, a professor of South Asian Studies at Jawaharlal Nehru University, told DW. "I think the impending economic crisis is a discernible reason for this change. It works good for India as it does not have to face a thoroughly anti-India regime."

Crisis pushing Male closer to New Delhi

The analyst said India will grow more important for Muizzu if the economic crisis deepens.

"It depends on how far he is going to resist Chinese pressure, pro-China lobby and radical Islamists," added Sahadevan.

The Maldives is one of the key elements in India's maritime security calculus as the archipelago sits in the middle of major shipping lanes connecting east and west Asia.

It is also central to the US strategy of countering China in the Indo-Pacific.

At the same time, Beijing has been undertaking infrastructure projects and economic investments in the Indian Ocean region as part of its Belt and Road Initiative (BRI). President Xi also offered to support "the Maldives firmly in safeguarding its national sovereignty, independence, territorial integrity and national dignity", China's state news agency Xinhua said.

Veteran diplomat Anil Wadhwa agrees that Muizzu's upcoming visit signals a softening of his "India Out" stance.

"Maldives has realized that India is the only country which can quickly respond in a crisis in Maldives and bail it out in times of crisis. One such crisis is the looming financial repayments and Maldives under Muizzu will be preparing to address and raise this. Any further provocation of India in these circumstances will be counterproductive for Maldives," said Wadhwa.

Edited by: Darko Janjevic