India grants concessions in repayment of LOC facilities

Government of India has granted Maldives concessions in the repayment of the loans accumulated through Line of Credit (LOC) agreements.

In a press conference held at Hotel Jen this evening, Indian Foreign Secretary Vikram Misri stated that with the concessions now granted, Maldives will see a 40 percent decrease in the annual repayment obligations.

Misri stated that the concessions were granted on request from the government of Maldives, in light of the financial burdens currently carried by the country.

Of the USD 878 million LOC entered into during the previous administration, approximately 50 percent has been used.

Misri said that although for various reasons, the remaining amount was left unused, terms under the agreement necessitated that the total amount be covered in repayment.

Referring to amendments brought to the agreement, Misri said that the changes had been implemented taking into consideration the economic status of Maldives, considering it special circumstances.

With the new concessions, Maldives now has to repay the amount dispersed.

The previous administration took approximately USD 1.4 billion (MVR 22 billion) in loans from India. This includes USD 400 million (MVR 6.1 billion) for the Vilimale' bridge project.

Indian Prime Minister Narendra Modi also extended a new INR 4850 crore line of credit facility (equivalent to USD 565 million) to Maldives today. Misri noted that this is the first time that an LOC in Indian Rupee denomination has been extended to Maldives.