What Happened
- India announced a special economic package of $175 million for Seychelles during the state visit of Seychelles President Patrick Herminie to New Delhi
- The package comprises $125 million as a Line of Credit and $50 million as grant assistance
- The funds will support projects in social housing, e-mobility, vocational training, health, defence, and maritime security
- Both nations adopted a Joint Vision titled SESEL (Sustainability, Economic Growth and Security through Enhanced Linkages)
- This is President Herminie's first state visit to India after assuming the Seychellois presidency
Static Topic Bridges
India's Development Partnership and Lines of Credit
India's development assistance to smaller nations operates through multiple instruments, distinct from traditional donor-recipient aid models. Lines of Credit (LoC) are extended through the Export-Import Bank of India (Exim Bank) and are concessional loans that promote Indian exports while financing development projects abroad.
- India's LoC programme is administered by Exim Bank under the Ministry of External Affairs
- Unlike grants, LoCs require repayment but carry below-market interest rates and longer repayment periods
- India has extended over 300 LoCs to developing nations across Africa, Asia, and the Pacific
- The LoC model ties procurement to Indian companies, promoting both diplomacy and exports
- Grant assistance (like the $50 million component) is non-repayable and typically used for capacity-building and humanitarian projects
Connection to this news: The $175 million package blends both instruments — $125 million LoC and $50 million grant — a common Indian approach to island nations, balancing strategic relationship-building with economic engagement.
India-Seychelles Bilateral Relations
India-Seychelles relations are anchored in shared maritime interests in the Indian Ocean. Seychelles, an archipelago of 115 islands, holds strategic importance due to its location along key sea lanes of communication (SLOCs) in the western Indian Ocean.
- India established diplomatic relations with Seychelles in 1976, the year of Seychelles' independence
- India operates a coastal surveillance radar system in Seychelles for maritime domain awareness
- The Assumption Island naval facility project was proposed in 2015 and a revised agreement signed in 2018, but faced domestic opposition in Seychelles over sovereignty concerns and was eventually shelved
- India has provided patrol vessels, Dornier maritime surveillance aircraft, and hydrographic survey support to Seychelles
- The Indian diaspora in Seychelles numbers around 10,000 in a total population of approximately 100,000
Connection to this news: The $175 million package and the new SESEL Joint Vision represent India's recalibrated approach — using economic development assistance rather than military base agreements to deepen strategic ties with Seychelles.
SAGAR and MAHASAGAR Maritime Doctrines
India's maritime engagement with island nations is guided by the SAGAR doctrine — Security and Growth for All in the Region — announced by PM Modi in 2015 during an address to the Indian Ocean Rim Association (IORA).
- SAGAR focuses on five pillars: safeguarding mainland and island territories; deepening economic and security cooperation; collective action for sustainable development; cooperative regional frameworks; and increased maritime engagement
- In March 2025, India launched MAHASAGAR (Mutual and Holistic Advancement for Security and Growth Across Regions), expanding SAGAR's scope to the wider Global South
- India has set up a dedicated Indian Ocean Division within the Ministry of External Affairs since 2016
- India operates the Information Fusion Centre for the Indian Ocean Region (IFC-IOR) in Gurugram for maritime domain awareness
- The Indian Navy conducts regular bilateral exercises with island nations: SECAT with Seychelles, DOSTI with Maldives, and exercises with Mauritius
Connection to this news: The economic package for Seychelles is a direct operationalisation of SAGAR/MAHASAGAR principles — using development assistance and security cooperation rather than military dominance to build a cooperative maritime architecture.
Key Facts & Data
- Package value: $175 million ($125 million LoC + $50 million grant)
- Sectors covered: Social housing, e-mobility, vocational training, health, defence, maritime security
- Joint Vision adopted: SESEL (Sustainability, Economic Growth and Security through Enhanced Linkages)
- Seychelles: Archipelago of 115 islands in the western Indian Ocean, population ~100,000
- India's Exim Bank has extended over 300 Lines of Credit to developing countries
- SAGAR doctrine launched: 2015; MAHASAGAR vision launched: March 2025
- India has provided Seychelles with patrol vessels, Dornier aircraft, and coastal radar systems