China and India Compete for Influence in the Maldives

The Maldives, an archipelago nation with a population of just half a million people, has become a battleground between China and India for influence in the Indian Ocean. While the beach tourists’ paradise has typically relied on its nearest neighbour India for much of its food imports and tourism, the newly elected president, Mohamed Muizzu, is pro-Beijing and openly antagonistic to New Delhi. This political shift has led to calls for a tourism boycott in India, while the Maldives have requested India withdraw its troops from the nation.

The Maldives are crucial to both India and China for obvious geographic reasons. The islands occupy a strategically important position in the Indian Ocean between the Indian subcontinent, the Arabian peninsula, the Red Sea and the East Coast of Africa. This influential geostrategic location has made the Maldives politically, economically, and military significant to both of these prominent BRICS rivals.

India’s foreign policy seeks to maintain a strong presence in the Indian Ocean in what is known as its Neighbourhood First policy. India’s goal is to contain Pakistan while fostering indispensable economic ties with the smaller states on its periphery, such as Sri Lanka, Nepal, Bhutan, Bangladesh, and the Maldives. However, just as manufacturers have shifted production from China to India to avoid risks associated with an overly dominant China, many of India’s smaller neighbours have sought to resist Indian regional dominance by courting closer relations with Beijing.

This competition for influence usually plays to China’s strengths with its enormous domestic market and aggressive foreign investment strategy. But besides these economic factors, there are political issues too. India’s Hindu nationalist ideology can be seen as discrimination against minority religions and can produce anti-India sentiment in the smaller regional states, especially Muslim ones, such as the Maldives. This could explain why the Maldives elected a pro-China president who campaigned against India’s growing influence on the islands.

Nevertheless, this political shift in the Maldives could come with economic consequences. As much as the new administration appears to be hostile to India, it cannot feasibly afford to ignore or dismiss New Delhi completely. With tourism comprising more than one quarter of the Maldives national income, the impacts on the tourism market alone could be severe. The Maldives has already sought to limit the damage and ultimately the shift towards China could prove more about bargaining for increased investment and maintaining independence than actively challenging India.

Tourism Boycott

After making disparaging remarks about Indian PM Narendra Modi on social media, several Maldives ministers were forced to resign. In response to the scandalous comments, one of the largest Indian ticket-booking sites, EaseMyTrip, suspended all flight bookings to the popular tourist destination. The Maldives Association of Travel Agents and Tour Operators have urged the company to re-commence bookings, noting that the tourism sector is the crucial to the island nation’s economy, employing over 40,000 people.

After the ministers were dismissed for their comments, the Maldives Foreign Ministry distanced itself from the statements, clarifying that the opinions were not the government position and were made in a personal capacity. However, a host of opposition leaders have demanded that President Muizzu, elected in October last year, be held accountable for the fallout. The Maldives Association of Tourism strongly condemned the derogatory remarks, which included references to Modi as a “terrorist” and a “clown”, and hailed India as one of the Maldives’ closest neighbours and allies.

Meanwhile, Muizzu, who embarked on a five-day state visit to China amid the unfolding spat with New Delhi, urged Beijing to encourage more tourists to visit his country. Speaking at a forum in the Fujian province, Muizzu said China was the Maldives’ biggest source of tourists prior to coronavirus and he urged the country to intensify its efforts to regain its position. According to Maldives Tourism Ministry data, India and Russia topped the list of visitors in 2023 with 210,000 arrivals each, while visitors from China made up the third biggest group with roughly 190,000 visits recorded last year.

Military Developments

The spat between India and the Maldives has not just touched politics and economics but also the military sphere with the Maldives formally seeking the removal of Indian troops from the country. Pledging to remove any foreign military personal, as well as balancing trade, and reducing India’s influence, was part of Muizzu’s presidential campaign. This is a clear departure from the policies of his predecessor, Ibrahim Mohamed Solih, who cultivated close relations with New Delhi.

The military personal development followed days after Muizzu returned from his first trip to China since becoming president where Beijing agreed to provide $130 million for the development of the Maldives capital city, Malé. The two states also signed an agreement on agricultural cooperation. During his trip, Muizzu hailed China as one of the Maldives’ closest allies and development partners, remarking that his government must “end its dependence on one country for imported staple foods such as rice, sugar, and flour”. This was a clear reference to India. Under a bilateral agreement, India supplies these food items to the Maldives on favourable terms.

“We may be small, but that doesn’t give anyone the license to bully us,” Muizzu was quoted as saying by Maldivian media. “We aren’t in anyone’s backyard,” reiterated the pro-Chinese President. “We are an independent and sovereign state.” Reflecting on these comments, Indian External Affairs Minister Subrahmanyam Jaishankar acknowledged that this was the nature of politics and that not every state will be aligned with India all the time. 

While India offers major economic benefits to the Maldives in terms of trade and tourism, China’s economic clout can help the Maldives avoid an overreliance on India.  Nevertheless, there could be economic repercussions for countries such as the Maldives, caught in an inter-BRICS power struggle for influence among emerging market economies. These countries, many of which can be found in Africa, will need to strike the correct balance between these competing powers.