Budget 2025: Maldives Gets Highest Aid Increase, Ties Improve?

Aakhir Tak – In Shorts

The Union Budget 2025 allocated ₹600 crore to the Maldives, a 28% increase from last year.
In 2024, India-Maldives relations soured, leading to a reduction in aid to ₹470 crore.
Relations improved after President Mohamed Muizzu’s visit to India in October 2024.
Bhutan received the highest allocation of ₹2,150 crore, followed by Nepal at ₹700 crore.
Mauritius, African nations, and Sri Lanka also received financial assistance from India.

Aakhir Tak – In Depth

Maldives Sees Highest Aid Increase

In the Union Budget 2025, the Maldives received the highest increase in financial aid among South Asian countries, with a 28% rise, bringing the total allocation to ₹600 crore. This marks a shift from the previous year when strained relations led to a reduction in aid to ₹470 crore. The budget, presented by Finance Minister Nirmala Sitharaman, aligns with India’s ‘Neighbourhood First’ policy.

India-Maldives Relations on the Mend

In January 2024, Prime Minister Narendra Modi’s visit to Lakshadweep triggered controversy in the Maldives, with some leaders making derogatory remarks. As a result, the full Budget in July 2024 reduced aid to ₹400 crore before revising it to ₹470 crore. However, in October 2024, President Mohamed Muizzu visited India and acknowledged the strategic partnership between the two nations, leading to a shift in diplomatic ties.

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Aid Allocation to Other Nations

The budget allocated ₹2,150 crore to Bhutan, the highest among neighboring countries. Nepal secured ₹700 crore, while Mauritius received ₹500 crore. Aid to Myanmar was reduced from ₹400 crore to ₹350 crore. Interestingly, there was no change in allocations for Bangladesh and Sri Lanka, which remained at ₹120 crore and ₹300 crore, respectively. Meanwhile, African nations saw an increase from ₹200 crore to ₹225 crore.

Aakhir Tak – Key Takeaways to Remember

Maldives received a 28% higher aid allocation in Budget 2025.
Bhutan secured the highest aid at ₹2,150 crore.
India-Maldives relations are showing signs of improvement.
Aid to Myanmar and Mauritius saw reductions.
India continues its ‘Neighbourhood First’ policy with financial assistance to key nations.