The Maldives' China-India Conundrum

The hardline approach of embracing India "above all" by the Solih administration, backseat driven as it may be, in the face of Yameen's "over reliance" on Chinese financing is hurting the Maldives more than it is helping.

Source - By Maahid Photos via Pexels

Source - By Maahid Photos via Pexels

If the agreement to build a world class stadium in Hulhumalé was not sign enough about renewed connections with China, then recent news only seeks to cement the fact. A huge point of contention for the MDP government, in a direct reversal of the Yameen administration’s foreign policy engagements, had been its distinct anti-China sentiment admittedly mostly backseat driven by an unlikely source in terms of shaping multilateral, or even bilateral, relations — Speaker Mohamed Nasheed, since the MDP has come into office, has been using the considerable weight of his seat as the leader of the legislature, an authority that has no business shaping foreign policy on a practical level, to drive China away and embrace the previously “shunned” India. President Ibrahim Mohamed Solih had remained tight lipped on the situation, which in itself is not surprising for this president, as has been Foreign Minister Abdulla Shahid.

Though coming well past the mid-point of his administration, it would now appear that Solih, and Shahid, have spoken; but in action, rather than in words. Lingering questions upon the publication of the year’s budget plan seems to shed new light on the administration’s, revised, considerations when it comes to China. The budget had included a substantial foreign-aid portion which was obviously not listed under loans, as are most transactions with India — and with MVR968.2 million aid received, a significant component of this foreign-aid portion has materialised; not from India but provided by China.

This involved five key agreements between the two nations, with the main focus of this aid revolving around social and infrastructure projects, and initiatives. The agreements also included the building of the stadium, as well as another very unique opportunity; visa-free travel to China, for Maldivian citizens.

The positive impact of this is immense, as the Chinese economy is one that Maldivians can surely benefit from, given their nationally upheld exchange rates with the dollar. On top of this, the topic of the free-trade agreement was once again floated, with both parties committing to make it a reality. It must be understood that this agreement, as well as similar strengthening actions, was the main economic distinction between the Yameen administration and those that opposed his policies, ergo the MDP presidential campaign.

It is quite opportune that this “refreshed friendship” is now coming back onto the headlines with such dialogue now reopened, while the MDP opposition of yore had purported that agreements with China were all sold short and that the Maldives was allowing another nation to encroach upon the nation’s sovereignty — a position now being mirrored by the opposition but with India substituted for China. It is true that infrastructure deals with China has pushed some developing nations into debt and subsequent forfeiture of national development projects. Yet further observation seems to indicate that most of it was the mismanagement of those in power, or local corruption and embezzlement, that leads to a nation’s failure against the economic behemoth that is China. In most such instances if not all, as with the case of the Maldives during the politically tense years of the start of COVID-19, China has shown a readiness to restructure payments, something that is much rarely seen with commercial lenders. On the other hand Sri Lanka, during the Foreign Minister Wang's visit to the nation, has requested for a restructuring of their debt during to which China has not yet made an outright commitment to, as such it is perhaps any coming response in the following days that will speak to China's true intentions.

Still, the Maldivian population is, and should most definitely be, more aware of all such dealings and call out their leaders to account. The Chinese government has been criticised by the Maldivian political parties who stood against Yameen during his reign not only for the economical dangers that would happen upon mismanagement of agreements, but also due to the mistreatment of the Uighur Muslim population within their borders — while the international community has mostly failed to embrace a largely unified consensus on this issue, activists and other agencies have been fighting for years now for the issue to be taken more seriously.

India and the USA have been openly colluding on lessening the influence of China in the Indian Ocean and the Asian subcontinent, and strengthening military ties through security pacts. Economically, India had been quite agile, under the MDP government, in bringing the Maldives under their “big brother” shadow with the comparatively large Line of Credit, as well as the major infrastructure development projects being agreed upon with promise of repayment. 

India has also done what no other nation except the United Kingdom, in recent history, has done with the Maldives, which was to involve their military with boots on the ground and hulls in atoll waters. With radar towers being installed from the North to South of the nation, and the military port in Uthuru Thila Falhu, a military presence of foreign soldiers on Maldives’ sovereign territory is practically inevitable, regardless of any well-intentioned cooperation agreements.

Additionally the Maldives is in a prime location to benefit from developing sea trade and port capabilities, and the nation that helps them achieve this would inevitably exert the most control. With all this and more, that the public is not aware of due to “national security” concerns, the Maldives is in a murky situation, with both China and India vying for key positions of influence when it comes to the island nation. No aid is free aid, as even financial assistance is a diplomatic weapon, and should be treated with both respect and scrutiny.

What the citizenry should be aware of however, and constantly alert to, are the dealings of the administration — whichever party, or coalition, is at the helm administrative checks and balances, as well as public, professional and media scrutiny must always be at play.

With the Solih Administration veering further away from their initial stance regarding China, and with just over two years left in their term, there is yet time to right the ship and succeed or for the nation to careen into irrecoverable failure, considering all of the economic factors at play as well as the manner in which the administration has chosen to engage, in terms of geopolitics, with China and India. A failure will likely doom large sections of the Maldives to poverty for generations to come.

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