In April, Indian Prime Minister Narendra Modi hosted Maldivian President Abdulla Yameen in New Delhi, where they inked six agreements, including one on defense cooperation. A year earlier, Modi had cancelled a Maldives visit amid political chaos there. But India has reinitiated engagement with the archipelago, prompted by its new China-oriented trajectory. This demonstrates that small nations like the Maldives are in a position to benefit from India-China competition.
India’s new Maldives approach comes at a time in which maritime trade is becoming increasingly important for both India and China. China almost doubled its reliance upon imports to satisfy its oil needs between 2000 and 2014, while India’s dependence on oil imports jumped from 43 percent to 71 percent between 1990 and 2012. A substantial proportion of these imports travel along Indian Ocean trade routes. In addition, nearly one thirdof Chinese maritime commerce and the bulk of Indian trade involves Indian Ocean shipping.
China’s efforts in the Indian Ocean have at times sparked tension with India. A 2014 Chinese submarine visits to Sri Lanka and other spots in the Indian Ocean infuriated New Delhi, while the Indian press received with skepticism China’s Djibouti outpost, the first Chinese naval facility on foreign soil. In order to respond to heightened Chinese involvement in the region, India has initiated a proactive naval posture.
Both China and India rely on safe trade routes crossing the Indian Ocean, so both countries aim to boost their clout in the area. The Maldives plays a key role in this geopolitical competition. The archipelago is adjacent to the main regional shipping routes, making it an important Indian Ocean toehold.
China has sought to enhance its relationship with the Maldives through cooperation on infrastructure development and tourism. During Xi Jinping’s 2014 visit, the two countries discussed prospective projects such as the “China-Maldives Friendship Bridge,” a $210 million initiative, funded chiefly by Beijing. In 2014, 360,000 Chinese tourists traveled to the Maldives, constituting more than 30 percent of all visitors to the country.
India’s engagement with the Maldives features collaboration in various fields, including healthcare, military affairs, and infrastructure. Indian aid to the Maldives surged from $4 million in 2014 to $30 million in 2015 and 2016. This cooperation may further improve under Prime Minister Narendra Modi’s “Neighborhood First” policy, which prioritizes close ties to proximate countries.
Political instability in the Maldives has limited India’s effort to engage the country. When Maldivian President Abdulla Yameen initiated a crackdown on his political adversaries in February 2015 and imprisoned pro-India former President Mohamed Nasheed, a worried Modi called off his March 2015 trip to the archipelago.
Despite these limitation, the Maldives’ strategic location has encouraged India to continue its efforts to engage. In July 2015, the Maldives amended its constitution to allow foreign ownership of land, sparking Indian fears that China would try to develop “strategic assets” in the archipelago. Both China and the Maldives denied this, but the constitutional change nonetheless prompted India to revisit its relationship to the country. Indian External Affairs Minister Sushma Swaraj took a trip to the Maldives just after the amendment came into force.
India remains cautious, however, about trying to play a role in sorting out the political chaos in the Maldives. The growing Chinese presence in the Indian Ocean enables the Maldives to capitalize on the “China card” to limit India’s options by raising the possibility that Indian withdrawal or criticism will encourage the archipelago to tilt towards China. Additionally, while Modi’s “Neighborhood First” policy and Indian Ocean tour suggest that the security and common economic development of the region are high priorities for India, Maldivian President Yameen has made clear his view that foreign powers should keep out of the archipelago’s internal politics. Engaging in a dispute with the Maldives over domestic issues would have severely degraded the prospects of Modi’s fledgling Indian Ocean diplomacy.
For its part, the Maldives benefits from its ability to balance between China and India, turning their geopolitical competition into engagement and aid. By moving closer to China, Yameen impelled India to overcome its grievances tied to Maldivian domestic politics, demonstrating the country’s ability to use geopolitical competition in the Indian Ocean to its advantage.