Maldives holds the title of the most indebted nation in South Asia based on its debt-to-GDP ratio, as per the most recent data from the International Monetary Fund (IMF).

The latest data from the IMF indicates that the total public debt of Maldives has climbed to 125.4 percent of GDP, marking the peak in the region. Economists highlight that this debt magnitude presents a major challenge to the nation's macroeconomic stability.

Bhutan ranks as the second most indebted nation, with a debt level of 103.6 percent of its GDP. India, the biggest economy in the area, has a debt ratio of 84.1 percent, whereas Pakistan, which is experiencing a significant economic downturn, is at 72.8 percent. Nepal's debt stands at 48.1 percent, while Bangladesh continues to be the least indebted nation in South Asia at 42 percent of GDP.

The debt level of the Maldives is almost three times greater than that of Bangladesh. The nation is currently facing pressure to enhance fiscal discipline to handle its debt load and alleviate stress on public finances. The IMF’s analysis highlights the immediate need for Maldives to hasten fiscal reforms.

This year, the government approved a historic budget, primarily due to overall debt commitments totaling USD 1.1 billion. As per the most recent statistics from the Finance Ministry, MVR 8.7 billion has been utilized for loan repayments as of the 14th of the previous month.

Ex-President Abdulla Yameen Abdul Gayoom has asserted that the Maldives' debt might reach MVR 90 billion within the next two years if President Dr. Mohamed Muizzu continues his tenure.