New Delhi: The Maldives has received the highest increase in India’s development aid among Southeast Asian nations in the Union Budget 2025, following a tumultuous year in bilateral relations, media reports said.

After a reduction in 2024, the allocation for the Maldives surged by nearly 28% in the budget presented by Finance Minister Nirmala Sitharaman on Saturday.

As per the budget document, the Maldives has been allotted Rs 600 crore for the 2025-26 fiscal year, a significant rise from the Rs 470 crore it received in 2024-25.

The previous cut in aid came amid deteriorating ties after Maldivian leaders made derogatory remarks about Prime Minister Narendra Modi following his visit to Lakshadweep in January 2024.

The visit was perceived in the Maldives as an attempt to redirect tourism to the Indian archipelago.

However, relations improved after Maldivian President Mohamed Muizzu, who had campaigned on an ‘India Out’ platform, visited India in October 2024.

During bilateral talks, Muizzu acknowledged India as a "key partner," signalling a shift in approach.

In line with its ‘Neighbourhood First’ policy, India allocated the highest development aid to Bhutan at Rs 2,150 crore, followed by Nepal with Rs 700 crore.

The Maldives ranked third with Rs 600 crore, while Mauritius saw a reduction in aid to Rs 500 crore from Rs 576 crore in the previous year.

Meanwhile, Myanmar’s aid allocation was cut from Rs 400 crore to Rs 350 crore, while funding for Bangladesh and Sri Lanka remained unchanged.

African nations collectively saw an increase in their allocation from Rs 200 crore to Rs 225 crore.