New Delhi: India reconsider the usefulness to continue with his financial aid to the Maldives after the island nation decided to put a free trade agreement with China from this month.
According to some estimates, FTA will dent the income from the Maldives, since the customs-forgego will be $ 30-40 million a year. It will also be the trade balance against the Maldives ships, given the size and profile of the two economies.
Maldives preferential trade agreement with Turkey, signed in November, will also result in a loss of income for men. The Maldiven-Turkey PTA will take effect on a mutually agreed date in the first quarter of this year.
Although India has provided immediate enlightenment to the Maldives, there is concerns about long -term sustainability debts in the absence of clarity about the exposure of the fault of the country and concrete economic reforms by President Mohamed Mizzu, people who are familiar with the maldivic economy told et.
It is generally recognized by international financial institutions that have suspended the support of India the Maldivian economy, which has been hit by COVID and subsequent loss of income by tourism. Sources even said that India was generous in his financial aid and this has considerably improved the fiscal position of the Maldives and has contributed to its economic stability.
The Indian government has facilitated the role of two treasury drawings for $ 50 million each, each together with the interest of $ 6.4 million and conclusion of a currency swap agreement by $ 400 million and £ 3,000 crore facility.
When Muizzu visited India in October in October, it was decided to initiate discussions about free trade agreement about trade in goods and services between the two countries.
