The Maldives has repaid a $150 million loan from India as the island nation continues to face serious economic challenges. The repayment came through the settlement of treasury bills subscribed by the State Bank of India (SBI).

The Maldivian government settled the final $50 million tranche on September 17, External Affairs Ministry spokesperson Randhir Jaiswal said at a regular media briefing on Friday. SBI had subscribed to the total $150 million treasury bills in 2019. The bills were extended six times, each for one year.

The Maldives paid the principal amount, while the Indian government covered the interest on the $150 million treasury bills over the past five years. “The total amount paid by India in interest settlement was close to $45 million,” Jaiswal said.

Jaiswal said India has maintained a longstanding development partnership with the Maldives. New Delhi also provided a ₹30 billion currency swap facility to support the country’s financial system. “In addition, the SBI has also subscribed to treasury bonds worth $350 million, which are valid till 2029 and 2030,” Jaiswal said.

India also continues to supply essential commodities to the Maldives under its development cooperation partnership. The latest repayment will push the Maldives’ foreign exchange reserves below $600 million. The reserves stood at $643.8 million at the end of August, according to the Maldivian Monetary Authority.

India has supported the Maldives during its balance of payments and sovereign debt pressures through credit lines and assistance under the SAARC Currency Swap Framework. A $400 million currency swap facility extended in October 2024 helped ease liquidity pressures.

India-Maldives ties had deteriorated after President Mohamed Muizzu came to power on an “India Out” campaign and moved closer to China. Relations improved after his visit to India in October 2024, when New Delhi agreed to provide over ₹6,300 crore to help the Maldives manage its foreign exchange crisis. The country continues to face high public debt, weak foreign exchange reserves and heavy dependence on tourism and imports.