India's Modi announces credit worth $565 million to Maldives

Indian Prime Minister Narendra Modi on Friday announced a $565-million line of credit to the Maldives during a visit to the Indian Ocean archipelago, as the two countries launched formal talks for a free-trade agreement.

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Modi is visiting the Maldives, known for its upmarket tourist resorts, to mark the 60th anniversary of its independence and diplomatic relations between the two countries. The announcement came during Modi's joint media statement with Maldives' President Mohamed Muizzu.

The two-day visit is crucial to India's ambition to control the seas and shipping routes of the Indian Ocean in a race with its regional rival China. It also marks the further easing of diplomatic tensions between the two nations that followed the election of pro-China Muizzu in 2023.

Regional powers India and China compete for influence in the archipelago nation, which is strategically located in the Indian Ocean.

On Friday, Modi witnessed the exchange of agreements to cooperate in sectors such as fisheries, health, tourism and digital development. He also formally handed dozens of heavy vehicles to the Maldives' defense forces.