The Reserve Bank of India (RBI) has announced that the INR 48.50 billion ($506.58 million), approximately MVR 7.7 billion, credit line provided to the Maldives with the assistance of the Indian government has become operational.

According to Reuters, this facility now paves the way for signing agreements to disburse funds for individual development projects carried out in the Maldives.

Citing the Reserve Bank of India, Reuters reported that funds under this credit line will be disbursed for individual projects valued at no less than INR 5 billion. Under this agreement, at least 75 percent of the value of goods, works, and services required for contracts funded through this facility must be provided by Indian businesses, while the remaining 25 percent can be sourced from outside India. Media outlets have noted that this condition will increase demand for Indian goods and services.

In addition, the RBI has instructed that funds from this credit line cannot be used to pay agency commissions on exports. However, the bank noted that exporters may pay such commissions using their own funds or money held in Exchange Earners' Foreign Currency (EEFC) accounts.

According to the RBI circular, the final date for disbursing funds under this facility is up to 48 months from the scheduled contract completion date. The exchange rate used for these transactions is INR 95.7400 per US Dollar.

India agreed to provide the credit line to the Maldives through the Export-Import Bank of India (Exim Bank) to finance various development projects on July 25, 2025. This arrangement was formalized and signed between India and the Maldives during Indian Prime Minister Narendra Modi's official visit, coinciding with Independence Day that year.

Meanwhile, the current government has now fully repaid the USD 150 million budget support loan obtained from the State Bank of India during former President Ibrahim Mohamed Solih's administration. The Maldivian government settled the final USD 50 million of this amount last week.