Maldives President Ibrahim Mohamed Solih and India's Prime Minister Narendra Modi shake hands ahead of their meeting at Hyderabad House in New Delhi, December 17, 2018. REUTERS/Adnan Abidi
NEW DELHI, December 17 (Reuters) - India will give financial assistance of $1.4 billion to the Maldives, Prime Minister NarendraModi said on Monday, the biggest aid yet to the Indian Ocean island nation that is grappling with debt from a Chinese building spree.
Modi made the announcement after talks with Maldives' new president, Mohamed Ibrahim Solih, who defeated the pro-China strongman Abdulla Yameen in a surprise election result in October and is trying to reset tieswith India.
During a five-year construction boom in the Maldives,China built a sea bridge connecting the capital, Male, to the main airport andis developing the airport itself, as well as building housing on land reclaimedfrom the sea.
But the fast-paced building activity has stoked fearsthat the Maldives has loaded up on debt that could be anything from $1.5billion to more than $3 billion.
Solih's administration has said it is trying to find outjust how much the country of 400,000 people owes China.
Modi said India stood ready to help the Maldives as aclose friend and neighbour.
"For Maldives' social and economic development weare providing a financial assistance of $1.4 billion in the form of budgetarysupport, currency swap agreements and concessional lines of credit," hesaid during a brief media appearance with Solih.
Both India and China have been trying to build regionalinfluence in the Maldives and other Indian Ocean countries such as Sri Lankathat lie along vital shipping lanes.
Soon after he took over last month, Solih said statecoffers had been looted over the past few years and warned that the country wasin financial difficulty after racking up debt with Chinese lenders.
Solih said the Maldives and India had signed agreementsto cooperate on trade, health and defence. India would help improve Maldives'security through joint patrols as well as aerial surveillance, officials said.
India's big worry has been that China's expansivediplomacy in the region was aimed at securing an outpost on an island in theMaldives.
Modi said he had discussed regional security with Solihand both had agreed not to allow each other's territory to be used against theother.
