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India and Seychelles have signed an umbrella line of credit agreement worth Rs. 1250 crore, extended in rupees, to support priority development projects in the African island nation. The bilateral engagement, during Prime Minister Narendra Modi's visit, also resulted in an , an MoU for deploying in Seychelles, and discussions on cooperation in space, AI, cyber security, and defense.
This agreement underscores India's strategic engagement with the Indian Ocean Region (IOR) and its 'SAGAR' (Security and Growth for All in the Region) vision. The extension of the Line of Credit (LOC) in Indian Rupees is a significant step towards the internationalization of the currency, reducing reliance on the US Dollar and facilitating trade. The Extradition Treaty enhances cooperation in combating transnational crimes, a crucial aspect of regional security. By addressing Seychelles' specific needs, such as the request for an advanced light helicopter and centers for AI and cyber security, India strengthens its role as a preferred partner for defense and capacity building in the Global South.
The MoU to deploy the Unified Payments Interface (UPI) in Seychelles is a major push for India's digital public infrastructure diplomacy. Expanding UPI globally not only facilitates seamless remittances for the Indian diaspora and tourists but also positions India as a leader in digital financial inclusion. The LOC agreement, denominated in Rupees, is a strategic move to promote the Indian currency in international transactions, potentially lowering currency risk for both nations. This approach aligns with India's broader economic diplomacy goals of fostering economic interdependence and showcasing its technological advancements to partner countries.
Seychelles occupies a critical strategic position in the Western Indian Ocean, near vital sea lanes of communication (SLOCs). India's deepening partnership with Seychelles, encompassing defense (advanced light helicopter), space cooperation, and digital infrastructure, is a direct counter to the growing influence of other powers, particularly China, in the region. The reference to the 'MAHASAGAR' vision emphasizes maritime security and domain awareness, highlighting the shared challenges and opportunities in the Indian Ocean. This comprehensive engagement demonstrates India's commitment to building a secure, stable, and prosperous maritime neighborhood.