India and Maldives have signed a Memorandum of Understanding (MoU) to introduce the Unified Payments Interface (UPI) in the island nation. This development is expected to significantly boost the Maldives’ tourism sector, according to External Affairs Minister S. Jaishankar. The MoU was signed during Jaishankar’s three-day official visit to the Maldives.
The UPI system, developed by the National Payments Corporation of India (NPCI), is an instant real-time payment system that enables inter-bank transactions via mobile phones. Highlighting the significance of this digital payment innovation, Jaishankar noted that UPI has revolutionized financial transactions in India, with 40% of the world’s real-time digital payments occurring within the country. He expressed optimism that the introduction of UPI in the Maldives would soon lead to its first transaction in the region, positively impacting the local tourism industry.
Tourism plays a vital role in the Maldivian economy, contributing nearly 30% of the GDP and generating over 60% of the nation’s foreign exchange. The introduction of UPI is seen as a step towards enhancing the convenience and security of financial transactions for tourists and residents alike.
During the visit, Jaishankar and his Maldivian counterpart, Moosa Zameer, also discussed various bilateral issues and jointly inaugurated six High Impact Projects focused on areas such as street lighting, mental health, children’s speech therapy, and special education. Additionally, a renewal of the MoU between the National Centre for Good Governance and the Civil Services Commission was announced, aiming to train an additional 1,000 civil service officers from the Maldives.
The visit marked a significant reset in India-Maldives relations, following tensions last year over the presence of Indian military personnel in the Maldives. Both countries have committed to deepening their partnership, particularly in areas of trade, investment, and security, with discussions on a potential Free Trade Agreement (FTA) between the two nations also being proposed by President Mohamed Muizzu.
In his remarks, Jaishankar emphasized that India and the Maldives are not just close neighbors but natural partners, with mutual investments in each other’s development and progress. He reaffirmed India’s commitment to supporting the Maldives in overcoming economic challenges and ensuring stability in the region, guided by the philosophy of ‘Sabka Saath, Sabka Vikas’.
