India and the Maldives began negotiations on the India-Maldives Free Trade Agreement (FTA) on Monday, starting the first round of discussions.
According to the Indian Department of Commerce, the talks are being held virtually from June 29 to July 7.
First announced during President Dr Mohamed Muizzu’s 2024 visit to India, the agreement aims to strengthen economic ties and expand trade between the two countries. The Maldivian government is seeking feedback from local businesses as negotiations progress.
Economic Development and Trade Minister Mohamed Saeed stated that the FTA would create new opportunities for Maldivian businesses and support efforts to diversify the economy and reduce reliance on a single sector.
He noted that India, a major trading partner and a rapidly growing consumer market, would provide greater access for Maldivian fisheries, marine products, and locally manufactured goods. The agreement is also expected to benefit entrepreneurs, the creative economy, e-commerce, and tourism.
Opportunities for SMEs
Saeed stated that small and medium-sized enterprises (SMEs) would be among the main beneficiaries, with young entrepreneurs, women-led businesses, and home-based enterprises gaining easier access to the Indian market.
In addition to lowering trade barriers, the FTA is expected to simplify procedures, digitise documentation, and improve freight and customs processes, helping businesses reduce costs and operate more efficiently. It will also promote technical cooperation and technology transfer to enhance productivity.
The government identifies investment opportunities in fisheries value addition, digital services, renewable energy, healthcare, logistics, tourism, and education. Saeed stated that the agreement is being negotiated in consultation with stakeholders from key sectors, including fisheries, tourism, construction, aviation, and healthcare.
He added that the FTA would strengthen the Maldives’ economic resilience and help protect the country from global economic shocks.
The Maldives already has a free trade agreement with China and is a member of the South Asian Free Trade Area (SAFTA). Once the agreement with India takes effect, the Maldives will have preferential trade access to the world’s two most populous countries.
