India’s ongoing efforts to expand its global economic footprint have taken another step forward with the finalisation of Terms of Reference (ToRs) aimed at advancing future trade partnerships and strengthening regional economic connectivity.
The development is expected to pave the way for structured trade negotiations, deeper economic cooperation and enhanced market access between India and partner countries in the coming years.
Trade analysts say the move reflects India’s broader strategy of securing long-term economic partnerships through Free Trade Agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPAs), particularly across the Indian Ocean and Asia-Pacific region.
The Maldives is among the countries currently engaged in discussions with India on a bilateral Free Trade Agreement. India and the Maldives formally launched negotiations for the proposed India-Maldives Free Trade Agreement (IMFTA) in July 2025 after both sides agreed on the Terms of Reference for negotiations.
The proposed agreement is expected to establish a comprehensive framework covering trade liberalisation, investment facilitation, services cooperation and economic integration between the two countries.
Officials from both countries have stated that the FTA aims to reduce trade barriers, improve business connectivity and create new opportunities for exporters, investors and service providers.
Economic experts note that FTAs generally provide benefits such as reduced or zero tariffs on selected goods, easier customs procedures, improved access for businesses and enhanced investor confidence. Such agreements can also include provisions on services, digital trade, logistics cooperation and professional mobility depending on negotiation outcomes.
For the Maldives, closer trade integration with India could potentially improve access to one of the world’s largest consumer markets while supporting sectors such as fisheries, tourism, construction materials, pharmaceuticals, food imports and logistics.
Trade between the Maldives and India is primarily conducted in US dollars, although Indian Rupee-based settlement mechanisms and digital payment integration discussions have also been explored as part of broader economic cooperation initiatives.
According to available trade data, bilateral trade between India and the Maldives has continued to grow over the past two years. India’s trade balance with the Maldives stood at approximately USD 805 million during the 2023–2024 financial year before recording around USD 442 million in 2024–2025.
India remains one of the Maldives’ largest trading partners, supplying essential commodities including food products, medicines, construction materials, fuel and consumer goods.
The launch of FTA discussions also came amid renewed efforts by both countries to strengthen economic ties following high-level talks between Indian Prime Minister Narendra Modi and Maldivian President Dr Mohamed Muizzu in 2025. During the visit, both sides additionally agreed on infrastructure financing, debt repayment facilitation and broader economic cooperation initiatives.
India has in recent years accelerated trade negotiations globally as part of its strategy to position itself as a major manufacturing, investment and supply-chain hub. The country has signed or pursued multiple FTAs and CEPAs with partners across Europe, the Gulf and Asia. (Source: sansad.in and news syndicate)
