EXPLAINED

India–Mauritius Relations: $680 Million Economic Package and Strategic Embrace

By Team Superb IAS | 🕓 September 12, 2025

Introduction

Prime Minister Narendra Modi’s announcement of a $680 million special economic package for Mauritius, comprising grants, lines of credit, and strategic cooperation, signals a new chapter in bilateral ties. With rich historical bonds, vibrant trade, and growing geopolitical cooperation, the India–Mauritius partnership is a model for India’s “Security and Growth for All in the Region” (SAGAR) doctrine.

Syllabus Mapping

• Preliminary Exam: Current events of national and international importance.

• Mains GS-II: Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

Key Features of the $680 Million Package

1. Grant-Based Projects (USD 215 million)

• Construction of Sir Seewoosagur Ramgoolam National Hospital

• Establishment of AYUSH Centre of Excellence

• Setting up a veterinary school and animal hospital

• Provision of helicopters

2. Grant-cum-LOC (Line of Credit) Projects (USD 440 million)

• Completion of Air Traffic Control tower at SSR International Airport

• Development of the Motorway M4

• Expansion of the Ring Road (Phase II)

• Procurement of port-related equipment

3. Budgetary Assistance:

$25 million earmarked for the development and restructuring of Mauritius’ port and the surveillance/development of the Chagos Marine Protected Area.

4. Strategic Cooperation:

• Redevelopment of the Mauritius port enhances regional connectivity and counters piracy.

• Cooperation in marine surveillance strengthens India’s maritime outreach and supports environmental conservation.

5. MoUs Signed (7):

From science, technology, and power-sector cooperation to agreements for satellite research, launch vehicles, and telecom monitoring.

Why Mauritius Matters to India

• Historical Bonds: 70% of Mauritians are of Indian origin. India was among the first to establish diplomatic relations after Mauritius’ independence in 1968.

• Strategic Location: Western Indian Ocean, regional maritime hub, gateway to Africa. The Chagos Archipelago and Mauritius’ EEZ are critical security and connectivity points under SAGAR and the MAHASAGAR doctrine.

• Economic Ties:

  • Bilateral trade: Grown from $206.76m (2005–06) to $851.13m (2023–24). Indian exports—pharmaceuticals, cereals, prawns, meat; Mauritian exports—vanilla, medical devices, aluminium, and copper.

  • FDI: Mauritius is India’s second-largest FDI source—$175 billion since 2000, nearly 25% of total FDI. The CECPA (2021), India's first with an African nation, covers 1,000+ goods and services.

• Diaspora: A large Indian-origin population provides cultural, economic, and people-to-people ties.

India’s SAGAR and MAHASAGAR Policy: The Bigger Picture

• SAGAR (Security and Growth for All in the Region): Strengthens maritime security, anti-piracy, disaster response, and blue economy partnerships.

• MAHASAGAR Doctrine: Further cements India’s leadership in the Indian Ocean through deeper economic and strategic ties—Mauritius is a key partner.

Map Work

• Mauritius: Island nation in the southwest Indian Ocean, east of Madagascar.

• Chagos Archipelago: North of Mauritius; Diego Garcia is the largest. The UK recently agreed to hand over sovereignty to Mauritius, granting India new opportunities for partnership.

Recent Developments & Significance

• Infrastructure Boost: From hospitals to highways, India’s package props up Mauritius’ development and resilience.

• Maritime Security: Enhances India’s capabilities to secure vital sea lanes, prevent piracy, and respond to emergencies.

• Geopolitical Leverage: Counters China’s growing footprint in the Indian Ocean; deepens India’s standing as a net security provider.

• Environmental Partnership: India supports Chagos Marine Protected Area, advancing sustainability and regional goodwill.

Conclusion: Investment in a Shared Future

PM Modi underlined the partnership with Mauritius as “an investment in our shared future”. The multidimensional cooperation—spanning health, infrastructure, defence, and cultural ties—demonstrates how India leverages diplomacy, capacity-building, and diaspora connections to advance regional interests under the SAGAR and MAHASAGAR policies.

Stay tuned to Superb IAS for more strategic current affairs for UPSC!