India, Maldives special friendship as deep as waters of Indian ocean: PM Modi

India will continue to support Maldives in mitigating the economic impact of the COVID-19 pandemic, Prime Minister Narendra Modi said on Thursday.

He said in a tweet that friendship between the two countries is and will always remain as deep as the waters of the Indian Ocean.

"Thank you, President @ibusolih! India will continue to support the Maldives in mitigating the economic impact of the COVID-19 pandemic. Our special friendship is, and will always remain, as deep as the waters of the Indian Ocean," the Prime Minister said.

The Prime Minister made the remarks in response to the tweet by President of Maldives Ibrahim Mohamed Solih who had thanked India for the assistance of USD250 million as budget support and USD500 million for the Greater Male Connectivity Project.

"A landmark moment in Maldives-India cooperation today as we receive Indian assistance of USD250 million as budget support and USD500 million for the Greater Male Connectivity Project. I thank PM @narendramodi and the Indian people for their generosity and friendship," Solih had said in his tweet.

India on Thursday announced that it will fund the implementation of the Greater Male Connectivity Project (GMCP) to revitalise the Maldivian economy through a $400 million Line of Credit (LOC) and $100 million grant linking its capital Male with Gulhifalhu Port and Thilafushi industrial zone along with a regular cargo ferry service between the two countries to boost trade and commerce.

"Happy to announce the start of regular cargo ferry service between India and Maldives to boost trade and commerce. We are also starting an air travel bubble with Maldives to sustain and promote the dynamic people-to-people ties between the two countries," External Affairs Minister S. Jaishankar said in a tweet after virtual meeting with Maldives Foreign Minister Abdulla Shahid.

"India will fund the implementation of the Greater Male Connectivity Project through a $400 mn LOC & $100 mn grant. This 6.7 km bridge project connecting Male with Gulhifalhu Port and Thilafushi industrial zone will help revitalise and transform Maldivian economy, he added.

Sources said that there has been a reset in bilateral relations with Maldives since President Solih assumed office in November 2018.

In the last one-and-a-half years, President Solih and his government has acted on its 'India First' policy in right earnest. In line with its 'Neighbourhood First' policy, India has worked proactively to deepen its ties with the Maldives, they said.

The sources said that India's total financial commitment in the Maldives covering all loan and grant projects is well over US$ 2 billion, all of which have been announced after the coming into power of President Solih in November 2018.

The Greater Male Connectivity Project (GMCP) is a high visibility project which will be the largest ever infrastructure project to be implemented in the Maldives.

The project was a key election promise of the ruling Maldivian Democratic Party (MDP) for which the President of Maldives had personally sought India's assistance during his meeting with External Affairs Minister S Jaishankar in the Maldives in September 2019.

"It is noteworthy that approvals for a project of this scale were obtained in less than a year. This is unprecedented and is testimony to the special relations between India and the Maldives," a source said.

The GMCP involves the construction of 6.732 km of bridge and causeway links between the islands of Villingili, Gulhifahu and Thilafushi with Male. Out of the total length, the bridge-section will be 2.08 km, 780 m causeway section and 3.87 km embankment and causeway section, they added.

As of date, the 1.39 km Maldives-China Friendship Bridge (connecting Male with Hulhule and Hulhumale to its east) is the most visible infra-project in the Maldives. Once implemented, GMCP will render the infrastructure project insignificant in comparison, sources said.

The sources said it will help in demonstrating India's overarching presence in the Maldives through a high-visibility project in the Greater Male region and showcase India's expertise in conceptualizing and implementing a complex infrastructural project of this scale.

The GMCP has the potential to change the economic landscape of the Maldives. This project will be an infrastructural complement to the Gulhifalhu commercial port project which is being done under an Indian LoC of USD 800 million.

Since the current Male port has already reached its maximum physical capacity, the Maldives Government has decided to shift the Male port to Gulhifalhu island. This has given rise to the need to consider the development of link bridges to the three industrial islands for seamless connectivity, as per sources.

With tourism and fish exports coming to a grinding halt in March, the Maldivian economy is under immense strain due to the COVID-19 pandemic. Financial assistance has been requested personally by the President of Maldives, during his ....telecon with Prime Minister Narendra Modi, sources said.

"Maldives is facing a financial gap of USD 395 million for the rest of the year. The government has forecast GDP contraction of over 11 per cent, while World Bank has estimated a contraction of about 13-14 per cent," it added.

This is the first financial assistance that has been announced by the Indian government to any country to deal with COVID-19 pandemic. This assistance will help the Maldives government tide over the financial crisis, till their main revenue earners like tourism and fisheries exports return to normal.

It may be recalled that in order to bolster Maldives' dwindling Forex reserves, India provided USD 150 million to the Maldives under the bilateral currency swap agreement of USD 400 million.

The Government of Maldives can draw the remaining USD 250 million anytime till July 2021 to increase forex liquidity and exchange rate management. On the request of Maldives Government, the currency swap agreement has been further extended for a period of one year, sources said.

The proposal of a ferry service between India and Maldives was announced by Prime Minister Modi during his visit to the Maldives in June 2019.

During the COVID-19 pandemic, while Maldivian imports have fallen, exports from India have relatively increased, making it the second-largest exporter to the Maldives proving that India is a reliable supply partner, the sources said.

A direct cargo ferry service presents an opportunity for India to replace other countries and become the top trade partner of Maldives.

In this context and with many bilateral projects slated to commence in the next few months, it is the right time to start a cargo ferry service with the Maldives, the sources said and added that right from the start of the COVID-19 pandemic, India has proven that it stands with the Maldives in the time of any crisis.

India has donated consignments of 5.5 tonnes of essential medicines, helped in the evacuation of Maldivians from Wuhan, provided 580 tonnes of food aid, deployed a medical assistance team in order to help the Government of Maldives in dealing with the unprecedented situation.

In line with India's commitment to assist the Maldives in its economic recovery, it has been decided to create air travel bubble with the Maldives, which has opened its borders for international tourists since July 15.

Sources said the creation of an air bubble will help revive its tourism industry and boost its economy, which is under immense financial strain due to the COVID-19 pandemic. Maldives will be the first country in the neighbourhood with which an air travel bubble will be established.

Seven big projects are being implemented under the USD 800 million Line of Credit (LoC) extended by India to Maldives.

The projects are water supply and sewerage systems on 34 islands, Addu Development Project-Road Development and Reclamation, Expansion of Maldives Industrial Fisheries Compes (MIFCO) Facilities, Gulhifalhu Port Project, Hmadhoo International Airport Redevelopment, Construction of International cricket stadium in Hulhumale and Cancer hospital in Hulhumale.

With a geographical span from the northernmost to the southernmost islands of Maldives and by covering infrastructure, socio-economic and sports projects, these projects are expected to be transformational for the country and take India-Maldives relations to new heights, sources said.

( With inputs from ANI )