News DeskMALE’ — India and the Maldives have finalised the Terms of Reference for a Free Trade Agreement, marking the start of structured negotiations that officials say could conclude within 2026.
The Department of Commerce in New Delhi announced the finalisation as part of a broader push to expand India’s global trade engagement. The India-Maldives FTA is listed among the key initiatives, with the Terms of Reference signed to formally kickstart talks. The High Commission of India in Male’ shared the update, reiterating its commitment to strengthening trade and economic relations between the two countries.
The groundwork for the agreement was laid during Indian Prime Minister Narendra Modi’s state visit to the Maldives in July 2025, which produced a series of bilateral commitments including the trade framework. The finalisation of the Terms of Reference translates those commitments into a formal negotiating structure.
The two countries are natural trade partners. The Maldives relies heavily on imports from India for food, medicine and construction materials. India is also a significant source market for Maldivian tourism and a major partner in infrastructure development across the archipelago. An FTA would reduce tariffs on both sides, facilitate services and investment flows and deepen economic integration between two close maritime neighbours.
The agreement comes at a moment when the Maldives is actively seeking to diversify its trade and economic relationships. The country has been expanding currency arrangements, pursuing agreements with China and pushing for stronger ties with regional partners to reduce vulnerability to any single relationship or currency. A structured FTA with India, its nearest large neighbour, fits that strategy.
The move is mutually beneficial. For the Maldives it offers economic resilience and wider market access. For India it deepens its footprint in the Indian Ocean region at a time when strategic competition in the area is intensifying. Further details on negotiation timelines are expected from both governments in the coming months.
