The Trump administration is considering buying the Chagos Islands in the central Indian Ocean from Mauritius, but the cost of such a deal is unclear and Mauritius says it hasn’t been approached.
The White House is weighing several options to secure the Diego Garcia base, including purchasing the Chagos Islands directly from Mauritius, bypassing the United Kingdom, which currently administers the territory but has been unable to complete a handover deal.
U.S. Treasury Secretary Scott Bessent brought the purchase proposal to President Donald Trump, although it is not considered a leading option, according to reports.
A White House official, speaking on background, said Diego Garcia is “a vital and indispensable military installation of significant importance to the national security of the United States,” and that Trump remains opposed to Britain’s plan to transfer sovereignty of the islands.
Mauritius said it has not been approached by the Trump administration. “Mauritius’s position remains unchanged: its sovereignty over the Chagos Archipelago is non-negotiable,” the government said in a statement Monday.
Even if Mauritius were open to a deal, pricing such a purchase would be complicated. There is no standard methodology for valuing a strategic military asset like Diego Garcia. A merger-and-acquisition approach – valuing the territory based on its revenue stream – might be one option, but would likely not satisfy Mauritius or the indigenous Chagossian people.
Historical precedents exist. The U.S. bought Alaska for $7.2 million in 1867 and the Virgin Islands for $25 million in 1917, but analysts say those examples are too old to provide useful benchmarks.
The U.S. faced similar valuation uncertainty when Trump proposed buying Greenland, where cost estimates ranged from $186 billion to $4.4 trillion, The Center Square previously reported.
Mark Cancian, a senior adviser at the Center for Strategic and International Studies, said a long-term lease may be more realistic than an outright purchase.
“We might make a deal with Mauritius and the local people similar to what we did with the UK, and make this a long-term lease, not a purchase,” he told The Center Square. “Functionally, that would be the same for the United States.”
Any purchase would likely require congressional authorization and appropriation of funds.
The strategic importance of Diego Garcia is a key reason the administration is examining alternatives to the UK-Mauritius agreement. Diego Garcia lies in the central Indian Ocean and is one of 66 significant U.S. defense sites across the Indo-Pacific region, according to the Congressional Research Service.
The U.S. Navy installation spans about 6,200 acres and supports about 2,400 military and civilian personnel. It has served as a critical logistics hub for U.S. operations for decades, including the 1991 Gulf War, the 2003 Iraq War and, most recently, operations against Iran.
Trump criticized the UK’s plan to hand over the islands earlier this year, calling it a “big mistake.”
Britain paused the deal in April after the U.S. withdrew its support. The UK has said it will not proceed without U.S. backing. The existing agreement would have seen Mauritius take sovereignty while Britain retained access to Diego Garcia under a 99-year lease, paying Mauritius £101 million ($135 million) annually, according to Reuters.
Ultimately, any purchase price would come down to what the parties are willing to agree to, Cancian said.
“It would be a question of what the different parties would agree to,” he told The Center Square.
The Telegraph first reported the administration was considering a purchase of the islands as Britain’s planned sovereignty transfer remains on hold.
