Maldives, India launch negotiations for free trade agreement
Negotiations will also cover trade-facilitating measures.
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Maldives and India have formally commenced negotiations for a Free Trade Agreement (FTA), the Ministry of Economic Development and Trade announced in a press release on Friday.
The initiative was formalised through the exchange of Terms of Reference (TOR) during a state visit by India's Prime Minister to the Maldives. The decision follows the positive outcomes of a meeting between President Dr Mohamed Muizzu and Prime Minister Modi during the President's visit to India in October 2024.
The proposed FTA aims to "establish a comprehensive institutional framework for trade liberalisation and deeper economic cooperation," the ministry stated. The agreement is expected to strengthen bilateral economic ties by reducing trade barriers and facilitating investment flows between the two nations.
Negotiations will also cover trade-facilitating measures. These include the integration with India's Unified Payments Interface (UPI) and a streamlined local currency settlement mechanism.
According to the press release, these initiatives are intended to "simplify payment processes, boost cross-border trade and investment and provide greater convenience for Indian tourists visiting the Maldives and Maldivian citizens residing in India."
The ministry described the commencement of negotiations as a "transformative chapter in the longstanding Maldives-India trade relations, creating pathways for sustainable growth, enhanced market access, and enduring prosperity for both nations."
