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India has begun implementing a $506.6 million credit line for Maldives, with financing tied to individual development projects and procurement requirements.
Mariyam Adheela
Maldives' President Mohamed Muizzu meets with Indian Prime Minister Narendra Modi at Hyderabad House, New Delhi--
Male’: The Reserve Bank of India has started implementing a INR48.5 billion ($506.6 million) credit line for Maldives, with the facility taking effect on August 27.
According to RBI guidelines reported by Reuters, funds will be released through separate agreements for individual projects, with each agreement valued at a minimum of INR5 billion.
At least 75 percent of goods and services required for the projects must be sourced from Indian companies, while the remaining 25 percent can come from other countries.
The credit line cannot be used to pay commissions to export agents, with exporters required to cover those costs themselves.
The credit facility was agreed between India and Maldives last year through India’s Export-Import Bank to finance development projects in the Maldives.
The activation comes after the Maldivian government completed repayment of the final $50 million portion of a $150 million Treasury bill previously sold to the State Bank of India.
India also paid around $45 million in interest on the Treasury bill over five years, according to India’s Ministry of External Affairs.
