The government is working to implement a proposed free trade agreement (FTA) with India this year

Economic Development and Trade Minister Mohamed Saeed said that the deal is expected to create new opportunities for Maldivian businesses and strengthen economic ties between the two countries.

The Maldives-India Free Trade Agreement (IMFTA) was announced during President Dr Mohamed Muizzu's visit to India in 2024, when the two governments agreed to begin negotiations.

The government is currently seeking feedback from Maldivian businesses as discussions continue.

According to Minister Saeed, the agreement forms part of the government's strategy to diversify the economy and reduce its reliance on a single sector.

"India is one of the Maldives' largest trading partners and one of the world's biggest consumer markets. The free trade agreement will provide easier access for Maldivian products to one of the fastest-growing markets in the world," he said.

He said the agreement would provide greater market access for fisheries products, other marine products and locally manufactured goods, while creating opportunities for young entrepreneurs and businesses operating in the creative economy and e-commerce sectors.

Saeed also said the agreement would generate direct and indirect benefits for the tourism industry.

The Minister said small and medium-sized enterprises (SMEs) would be among the biggest beneficiaries of the agreement.

According to Minister Saeed, the FTA would create new opportunities for young entrepreneurs, women-led businesses and home-based enterprises to access the Indian market.

He said the agreement would go beyond reducing customs duties by simplifying administrative procedures, digitizing trade documentation and improving freight and customs processes.

"This agreement will not only reduce customs duties. It will remove administrative barriers to trade, digitize documentation and speed up freight and customs procedures. This will strengthen the operations of Maldivian businesses and reduce costs," he said.

He added that the agreement would also promote technical cooperation and technology transfer, helping to improve productivity.

The government expects investment opportunities under the agreement to include:

Minister Saeed said the agreement is being negotiated in consultation with stakeholders from sectors including fisheries, tourism, construction, aviation and healthcare.

He added that the government expects the agreement to improve the Maldives' economic resilience and help cushion the country against global economic shocks.

The Maldives is already a party to the South Asian Free Trade Area (SAFTA), although regional trade under that framework has remained limited. The country also has a free trade agreement with China.

Once implemented, the agreement with India would give the Maldives preferential trade arrangements with the world's two most populous countries.