Maldives upgrades ties with China amid pivot from India

By Joe Cash

BEIJING (Reuters) – China and the Maldives upgraded their relationship on Wednesday during newly elected President Mohamed Muizzu’s first state visit to Beijing, following a campaign in which he cast China’s regional rival India as a threat to sovereignty.

Chinese President Xi Jinping, speaking at the Great Hall of the People, called Muizzu “an old friend” as the Asian giant set the stage for further investment in the Indian Ocean archipelago by agreeing to a “comprehensive strategic cooperative partnership”.

“China and the Maldives’ relations are facing a historic opportunity to carry forward the past and forge ahead into the future,” Xi told Muizzu, Chinese state media reported.

Muizzu took office in November, after winning on his “India Out” campaign platform under which he called New Delhi’s huge influence a threat to sovereignty. His government has since asked dozens of locally based Indian military personnel to leave while talking up opportunities for Chinese investors despite being heavily indebted to Beijing.

Relations between India and China nosedived after soldiers from both sides clashed in the western Himalayas in June 2020, resulting in the death of 20 Indian soldiers and four Chinese troops.

By upgrading ties with the Maldives, China is setting the stage for further investment in a region where India has already seen another neighbour, Sri Lanka, gravitate towards China.

“During the talks, President Dr Muizzu expressed gratitude for China’s significant role in the Maldives’ economic success… and infrastructure development,” a statement from his presidential office read following the meeting, adding that “20 key agreements between the two countries” had been signed.

The Maldives owes China $1.37 billion, or around 20% of its public debt, according to World Bank data, making Beijing its biggest bilateral creditor ahead of Saudi Arabia and India, which it owes $124 million and $123 million, respectively.

Chinese firms have invested a further $1.37 billion in the Maldives since its decision to join the Belt and Road Initiative in 2014, data from the American Enterprise Institute think tank shows.

“China firmly supports the Maldives in safeguarding its national sovereignty, independence and national dignity,” state media reported Xi as saying. Beijing would also be willing to “exchange experience of state governance” with Male, Xinhua said.

Muizzu was given a tour of the Chinese Communist Party Museum in Beijing ahead of meeting with Xi, a video on X, formerly known as Twitter, from his presidential office account showed.

The World Bank in an October development report on the Maldives warned further cosying up to China could spell trouble as a “build-up of sovereign exposure” had taken place during the pandemic and there was a “lack of domestic investment opportunities”.

Xi said he backed increasing the number of direct flights between the two countries, in a potential boon for the Maldives’ travel and tourism sector, which constituted 79% of economic growth in 2022, according to the Asian Development Bank.

(Reporting by Beijing newsroom; Editing by Alison Williams)