Third wheel 

Third wheel 

Context

Free trade agreement between Maldives and China is a warning to India: It needs to do more legwork in its neighbourhood

What has happened?

Maldives and China have inked a FTA (Free Trade Agreement) together

Backdrop

• The agreement was in the works for 4 years, yet India failed to take steps to counter it. Moreover, Maldives is the only South Asian country that Prime Minister has not visited yet — one scheduled visit in March 2015 was put off
• The entire process of approving the FTA, finalised in September, was similar to the quick amendment of the Maldivian Constitution in July 2015 to allow foreigners to buy land freehold in any of its islands. The move had raised concerns in India that it was aimed at giving China a strategic foothold in the Indian Ocean. The FTA is bound to heighten that feeling

What is covered under FTA?

The agreement covers both goods and services in several sectors, from legal, accounting and insurance, to health, telecommunications, education, off-shore oil exploration, and geological prospecting; in goods, the main export from the Maldives would be tuna fish

Miscellaneous Info

The People’s Majlis is the unicameral legislative body of the Maldives

Conclusion

The present political leadership of the Maldives seems to believe that an FTA with China is in its national interest. India clearly needs fresh ideas and must do more legwork in its neighbourhood