Maldives' reserves currently hold enough funds to cover only one and a half months of imports

The Maldives' foreign currency reserves are projected to fall below $600 million by the end of this month, leaving enough to cover only about one and a half months of imports, according to statistics from the Maldives Monetary Authority (MMA). Data from the central bank shows that the country's reserves stood at $643.8 million at the end of August. Furthermore, figures from July indicate that the nation's total import bill reached $339.26 million.

Amidst declining national reserves, the Maldivian government on Thursday concluded the full repayment of a $150 million loan issued by India in 2019 through the State Bank of India (SBI). The final installment of $50 million was settled on September 17. This marks the complete liquidation of a debt for which India had been granting repayment extensions over the past two years.

Maldives' Finance Minister Hassan Zareer announced in a post on the social media platform 'X' that the final $50 million installment of a $150 million loan taken through the State Bank of India in 2019 has been settled. He further assured that despite this payment, comprehensive arrangements have been secured to ensure the uninterrupted import of essential commodities, including fuel, food, and medicine.

The Treasury Bill (T-bill) issued through the State Bank of India (SBI) reached its maturity date last week. India has previously granted multiple extensions for the repayment of this debt.

The emergency loan, issued to provide urgent budgetary support, totals approximately $200 million. The Muizzu administration, which assumed office in late 2023, made the initial repayment on this loan in January 2024.

India previously disclosed that $50 million of the total loan amount was provided as a grant, which does not require repayment.

In recent years, the Maldives' foreign currency reserves have faced significant challenges. The nation's economy remains heavily reliant on imported goods. Critics argue that the current dollar shortage and the mounting pressure on reserves are direct consequences of escalating government waste and irresponsible public spending.

India first extended the maturity of a $50 million Treasury bill in May 2024. Following a second extension in September 2024, the repayment period had been further pushed back through the end of 2025. However, the Maldivian government settled $50 million of the T-bill debt on May 11 this year, ahead of its scheduled maturity. The final outstanding payment was fully settled this past Thursday.

Furthermore, the Maldives' guaranteed external debt declined to $3.59 billion in the second quarter of this year, down from $4.05 billion at the end of the 2025 fiscal year.