'Neighbourhood First': India Hikes Budget Share For Maldives To Rs 600 Cr After Muizzu’s Damage Control

Last Updated:February 01, 2025, 16:44 IST

Budget 2025: On Saturday, India scaled up the budgetary allocation for the island nation by nearly Rs 130 crore, to Rs 600 crore from Rs 470 crore last year. However, the amount is still short of the pre-dispute allocation in 2023-24 of Rs 770.90 crore

Muizzu's bilateral visit last October resulted in a meeting with Prime Minister Narendra Modi, which was seen as the two nations considering the row as history. File pic/Reuters

India, which has a budgetary allocation for a few neighbouring countries, significantly slashed the share of the Maldives in the last budget as cabinet ministers of the island nation sparked a souring of ties. Ever since, much effort has been made by the Mohamed Muizzu-led government to rein in such elements and undo the damage done, with the country facing economic stress. Muizzu’s bilateral visit last October resulted in a meeting with Prime Minister Narendra Modi, which was seen as the two nations considering the row as history. In Budget 2025 presented on Saturday, India scaled up the budgetary allocation for the island nation by nearly Rs 130 crore, to Rs 600 crore from Rs 470 crore last year. However, the amount is still short of the pre-dispute allocation in 2023-24 of Rs 770.90 crore.

Government sources said the budget for the Maldives has increased due to India’s “neighbourhood first" policy, despite South Block being aware of President Mohamed Muizzu’s pro-China leanings.

Beach battle

In January 2024, relations between India and the Maldives, traditionally close neighbours with strong historical and cultural ties, became strained due to derogatory remarks made by Maldivian cabinet ministers and concerns over racism directed at Indian Prime Minister Narendra Modi and India as a whole. This happened when a series of photographs of Prime Minister Narendra Modi staring pensively out into the Arabian Sea, surrounded by Lakshadweep’s coastal splendour last January, not only set off a social media war between India and the Maldives but also triggered a low-key diplomatic row between the two friendly countries.

When he visited the island, known for its largely untouched natural beauty, to promote infrastructure development and tourism, the Prime Minister would not have anticipated such a harsh and uncharacteristic reaction from the Maldives.

The row was mainly triggered by a senior minister in the Muizzu-led government, Abdulla Mahzoom Majid, who accused India of targeting his country. He said India faces significant challenges in competing with the Maldives when it comes to beach tourism. His remarks on X came after PM Modi put out his Lakshadweep post, which went viral and prompted many social media users to suggest that the union territory could be an alternate tourist destination to the Maldives.

Majid later deleted his post, but the damage was done. Mariyam Shiuna, Maldives’ deputy minister of youth empowerment, information, and arts, called Modi a “clown" and “puppet of Israel" in a post on X. While Shiuna has deleted the post since, her government also suspended her. Shiuna also compared India to “cow dung".

“What a clown. The puppet of Israel, Mr Narendra, diver with a life jacket. #VisitMaldives #SunnySideOfLife," she said in her post.

Malsha Sharif, another deputy minister in the same ministry, also made derogatory comments of a similar nature against India. Both were suspended along with another government official, Hasan Zihan, deputy minister of transport and civil aviation.

PM Modi’s plans

But PM Modi had his plans for Lakshadweep that the Maldives feared would be strong competition. Even before a year completed after the row began, Prime Minister Narendra Modi visited Lakshadweep, and the photographs created a new interest in the archipelago, the Centre is preparing to unveil eight big projects to enhance Lakshadweep’s connectivity for tourists and give the likes of the Maldives a run for their money.

CNN-News18 has accessed a union government document that lists out these projects—including the capability for larger vessels to come to the Kavaratti, Agatti, and Minicoy islands, the development of landside facilities, including passenger facilitation centres with modern amenities at the Kalpeni, Kadmat, and Androth islands, and the development of open jetties that can handle even cruise vessels at the Kalpeni and Kadmat islands. Work will begin soon on the first project worth Rs 303 crore—the construction of jetties and landside at the Kadmat Island—for which tenders were invited on December 4.

News business 'Neighbourhood First': India Hikes Budget Share For Maldives To Rs 600 Cr After Muizzu’s Damage Control