India extends USD 150Million foreign currency swap to support Maldives

April 28: India today extended the USD 150 million foreign currency swap as part of the USD 400 million bilateral agreement with the Maldives. The agreement was facilitated by Maldives President Ibrahim Mohamed Solih, President of the Republic of Maldives during his state visit to India in December 2018 and signed in July 2019.

The Maldives Monetary Authority(MMA) obtained a foreign currency swap facility with the Reserve Bank of India. The Maldives maintains a de facto stabilized exchange rate arrangement. The arrangement was activated to help the Maldives mitigate the financial impact of #COVID19.

Recently Maldives has been facing economic crunch mostly due to the slump in tourism which primarily accounts for 65% of GDP. This affects the employment and household earnings as one-third of adult males and a quarter of females are engaged in tourism-related jobs. Fisheries and construction which are the next important trade are also exported due to suppressed demand.