Mauritius PM hopeful of ‘quick resolution’ to tax treaty with India
Ramgoolam (right), who was in India to attend newly-elected Indian Prime Minister Narendra Modi’s swearing in ceremony on Monday, also stressed that Mauritius would never allow its jurisdiction to be abused for any illicit activities. (Image: RV Moorthy/The Hindu)
Mauritius Prime Minister Navin Ramgoolam on Tuesday said that there must be a ‘quick resolution’ to all issues related to the direct tax avoidance agreement between the two countries.
The proposed revision of the Mauritius-India tax treaty has been on the anvil for long, spurring uncertainty among investors seeking to route their investments through the island nation into the Asian emerging economy.
Besides, there have been reports that Indian Ocean island nation was not agreeable to certain suggestions made by India, which has been seeking to make the agreement stronger to prevent any possible round tripping of Indian funds through Mauritius.
On the contentious issue of revision of the tax treaty between the two countries, Ramgoolam added that both parties agreed that there must be quick resolution on the issues ‘for certainty, clarity and predictability.’
Ramgoolam, who was in India to attend newly-elected Indian Prime Minister Narendra Modi’s swearing in ceremony on Monday, also stressed that Mauritius would never allow its jurisdiction to be abused for any illicit activities.
Also, in an encouraging move, the island nation has decided to provide automatic exchange of tax related information with India, in a bid to lay to rest long-drawn out apprehensions that the island economy is being used for money laundering activities
Addressing the media after a bilateral meeting with Modi on Tuesday morning, Ramgoolam concluded on the note that he had invited the Indian Prime Minister to visit Mauritius.
It may be noted that recent data from the Indian Department of Industrial Policy and Promotion (DIPP) shows that Mauritius has been dethroned by Singapore as the top source of Foreign Direct Investment (FDI) into India, with the Asia Pacific island economy accounting for 25% of FDI inflows into the emerging Asian economy in 2013-14.
And, the reason behind this reversal of trend is the uncertainty over the Double Tax Avoidance Agreement (DTAA) between India and Mauritius. Accordingly, a favourable resolution of the treaty is an important agenda for both the Indian and the Mauritian governments.
Meanwhile, Indian Foreign Secretary Sujatha Singh stated that both leaders also agreed to work together with all the other members in further strengthening Indian Ocean Rim Association.
“Both leaders agreed to further strengthen relations especially economic cooperation and interactions in the field of maritime security, renewable energy and blue economy including development of related infrastructure,” she added.
Source: Press Trust of India