RBI’s $400 Million Support Assists Maldives 🌍
- India and the Maldives have strengthened financial ties through a $400 million currency swap agreement, agreed upon in October 2024 between the Reserve Bank of India (RBI) and the Maldives Monetary Authority (MMA) ft.com+5money.rediff.com+5timesofindia.indiatimes.com+5timesofindia.indiatimes.com.
- This infusion has significantly lifted the foreign exchange reserves of the Maldives and eased external liquidity pressures, as noted by the Indian High Commission via social media timesofindia.indiatimes.com+4money.rediff.com+4news.broearn.com+4.
Fitch Ratings’ Perspective
- In a recent rating update, Fitch specifically referenced this swap, stating it “alleviated imminent external liquidity strains,” contributing to stabilizing the Maldives’ credit profile m.economictimes.com+3money.rediff.com+3taxtmi.com+3.
- However, Fitch continues to flag persistent external and fiscal vulnerabilities, especially concerning debt-servicing needs in the year ahead news.broearn.com+4money.rediff.com+4m.economictimes.com+4.
🇮🇳🇲🇻 Strategic Implications:
- Regional financial cooperation reinforced between India and its neighbour.
- Immediate liquidity relief for the Maldives, though structural fiscal risks persist.
- Strong signal of India’s role as a financial anchor in the Indian Ocean region.
Disclaimer:
This article is not authored or drafted by any employee of FinMen Advisors. The information is entirely sourced from the above news link. FinMen Advisors is not responsible for the accuracy, completeness, or reliability of the information.
