Maldives government plans to set up India’s financial and payment service system RuPay in their country. The decision comes after the diplomatic tussle between the two countries took place in January 2024.
Maldivian officials said that they are engaged in discussions with India for smoother facilities of payment in rupees. However, the launch date has not been announced yet.
What is RuPay ?
RuPay is an Indian multinational financial and payment service system launched by National Payments Corporation of India [NPCI] in 2012. It has wide acceptance in ATMs, PoS devices and e-commerce websites in India.
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Decision between tension
The decision for the usage of RuPay was taken in 2022, when the then President of Maldives Ibrahim Mohammed Solih decided to encourage travel and tourism with economic relations.
Maldivian Officials said on Wednesday that both India and China have agreed to help in payment for imports in their respective currencies instead of the US dollar. This proposal is likely to help Maldives save 50% of the annual $1.5 million import bill from both the countries.
This move will strengthen “Maldivian Rufiyaa” , said the Maldivian Official.
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Leave the Country campaign created Tension
India – Maldives relations strained after the pro-China President assumed power last November. After assuming power he called on Indian soldiers to leave the country which increased the tension between the two nations.
Maldives’ growing partnership with China has brought significant economic changes. China has made several large infrastructure developments in Maldives through Belt and Road Initiative (BRI). Bilateral ties strengthened after newly elected President Mohammed Muizzu made China the destination of his first foreign visit in January 2024 where he signed new agreements on financial and military assistance.
However, Maldives cannot ditch its long term partner New Delhi. The President is signaling a return to normalcy.
About Author
This Article is written by Ms Simran Akhouri, a postgraduate in journalism from University of Delhi. She has developed strong writing skills that allow her to convey stories. She is passionate in uncovering the truth and delivering it to the public in an engaging and accessible manner.
