In its multi-vector foreign policy, India has traditionally placed special emphasis on relations with its former colonial ruler.
Signing of a Landmark Free Trade Agreement Between Britain and India
At the invitation of British Prime Minister Keir Starmer, Indian leader Narendra Modi arrived in London and held talks with him on a wide range of bilateral cooperation issues across various fields. The centerpiece of the discussions in London was the signing of a bilateral free trade agreement, which had been under negotiation for over three years. The agreement significantly reduces tariffs on exported goods and is expected to increase annual bilateral trade to $35 billion. Currently, trade between the two countries exceeds $55 billion, and by 2030, the parties aim to raise this figure to $120 billion. Notably, London and Delhi are major investors in each other’s economies: Britain has invested around $36 billion in India, while Indian investments in the UK amount to approximately $20 billion. Moreover, over a thousand Indian companies operate in Britain across various sectors, and the country is home to one of the largest Indian diasporas (about 2 million people), whose members play a significant role not only in trade and economics but also in political life.
The negotiations also covered defense, intelligence, innovation, education, scientific-technical, and cultural cooperation, with corresponding agreements signed on these matters. Narendra Modi was received by King Charles III, met with the Indian diaspora, and addressed business leaders. A key focus of these meetings was the conclusion of the “long-awaited and historic” free trade agreement and a shared vision for bilateral relations up to 2035.
This marked Modi’s fourth visit to Britain, reaffirming the special and prioritized nature of the multifaceted and highly successful cooperation between the two countries, as well as their alignment on discussed international and regional issues, including the need to combat terrorism.
A Major Shift in Relations
From London, the Indian Prime Minister traveled on July 25 to the Maldivian capital, Malé, where he was invited as the chief guest for celebrations marking the 60th anniversary of independence of this small Muslim island nation in the Indian Ocean. Simultaneously, the two sides commemorated 60 years of diplomatic relations. For the Maldives, India has been and remains the primary trade, economic, financial, and defense partner, though New Delhi faces geopolitical competition from China, which has been actively working to expand its influence in Malé and diminish India’s presence. The Americans have also entered the fray on the island, though they currently play a secondary role.
After the change of government in the Maldives in 2023 and the rise to power of new President Mohamed Muizzu, tensions escalated between traditional pro-India factions and those favoring a China-leaning foreign policy in this tourism-dependent island nation. Calls emerged to reduce India’s military and political presence and decrease economic and financial dependence on it. In early 2024, during the Maldivian leader’s visit to Beijing, over 20 bilateral agreements were signed, strengthening China’s position on the island.
However, India did not accept this situation and managed to restore its dominant presence in the Maldives, as evidenced by the outcomes of the Maldivian president’s visit to India in October 2024. Agreements were reached on new financial aid to the island (totaling about $1 billion), along with documents on a shared vision for economic and maritime partnership, as well as cooperation in defense, security, and tourism. The two sides agreed that the powerful neighbor (India) would not encroach on the Maldives’ tourism market (given its own island tourist zone in Lakshadweep) and would continue stabilizing Malé’s economic and financial situation.
The progress of these large-scale bilateral cooperation programs was the focus of Narendra Modi’s third visit—and first since the change of government—to the Maldives on July 25-26. The talks held and the new package of agreements signed confirmed that India remains the Maldives’ primary and most influential partner. The parties agreed to finalize an important free trade agreement soon. As a special gesture to boost trade and improve tourism infrastructure, India opened another credit line to the Maldives, this time worth $545 million. These and other agreements reached during the talks expand opportunities for deepening bilateral cooperation in various fields and reaffirm India’s leading role in the affairs of the island nation.
Anvar Azimov, diplomat and political analyst, Ambassador Extraordinary and Plenipotentiary, Candidate of Historical Sciences, Senior Research Fellow at the Eurasian Studies Institute, MGIMO (Moscow State Institute of International Relations), Russian Ministry of Foreign Affairs
