India lent money to the Maldives, a tropical island country in the Indian Ocean, to free it from the ‘debt trap’ it had contracted with the Chinese Communist Party (CCP).
India’s support could be taken as an act of resistance to the ambitions of the CCP in the region, according to the Indian media Tfi Post of Sept. 22.
The president of the Maldives, Ibrahim Mohamed Solih, made public his gratitude to India’s prime minister, Narendra Modi, for the $250 million loans. “India has always risen to the occasion whenever the Maldives needed a friend,” Solih began in his tweet. “My sincere thanks to Prime Minister Narendra Modi, the Government and people of India for their neighborly spirit and generosity following the official handover of $250 million in financial assistance today,” Solih concluded.
Modi replied: Appreciate your warm feelings, President Solih!
As close friends and neighbors, India and the Maldives will continue to support each other in our fight against the health and economic impact of COVID-19 [CCP Virus].”
Appreciate your warm sentiments, President @ibusolih! As close friends and neighbours, India and Maldives will continue to support each other in our fight against the health and economic impact of COVID-19. https://t.co/esNRBWJxZg
— Narendra Modi (@narendramodi) September 21, 2020
The Maldives has a GDP of $5.7 billion and to service a debt of $1.4 billion with the CCP is an overwhelming economic burden. Some analysts fear that the debt is even greater.
For the Maldives, the closures caused by the CCP Virus have been devastating.
The tiny country relies on tourism as its primary source of income, and that is practically non-existent.
Solih assumed the presidency in 2018 by defeating the pro-Chinese former president Abdulla Yameen.
That means he took on the debt incurred by the previous leader.
Under the former administration, the Maldives borrowed some $1.4 billion from Beijing for expensive infrastructure projects, according to Solih’s government.
The Maldives, with Solih as president, supports India and the United States’ policies in the face of CCP ambitions that threaten mainly small and weak nations, which are often caught in so-called debt traps.
Conditions are such that the CCP often takes control of the primary sources of wealth of countries that succumb to the financial burden.
That is Laos’s case, a small and poor country in Southeast Asia, which lost majority control of its electricity network by ceding it to a company regulated by the CCP, trying to avoid defaulting on its debt, according to Reuters.
The territory of the Maldives consists of 26 ring-shaped atolls with more than 1,000 coral islands. It is famous for its beaches, blue lagoons, and vast reefs.