Mauritius is seeking amendments to the Double Taxation Avoidance Convention with India to restore its investment position, as FDI inflows have declined since 2016. Minister Ramful highlighted the need for parity with Singapore and emphasized Mauritius as a gateway to African markets. Upcoming discussions and significant agreements may enhance economic ties during Prime Minister Modi’s visit.
Mauritius’ Foreign and Trade Minister, Dhananjay Ramful, has announced the country’s intentions to amend its trade agreement, particularly the Double Taxation Avoidance Convention (DTAC) with India. In an interview at his office in Port Louis, he emphasized the necessity to revisit the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) to improve Mauritius’ status as an investment conduit, as foreign direct investment (FDI) from Mauritius to India has significantly declined since the 2016 treaty revisions.
Minister Ramful mentioned that discussions surrounding the DTAC amendment are ongoing, with two key issues requiring resolution before a protocol can be signed. He indicated that a second session of the joint committee will be convened soon to address both the CECPA and DTAC, with the goal of rectifying trade imbalances and taxation challenges.
Historically, Mauritius has invested a cumulative $175 billion in FDI into India since 2000, representing 25 percent of total FDI inflows into the country. However, following the revisions in 2016 aimed at curbing tax avoidance, FDI from Mauritius has dropped from $15.72 billion in 2016-17 to just $6.13 billion in 2022-23. Notwithstanding this decrease, Mauritius was still India’s third-largest FDI source in 2022-23, with inflows showing a rebound in 2023-24 to $7.97 billion, placing it as the second-largest FDI source after Singapore.
Ramful highlighted the desire for Mauritius to achieve parity with Singapore in investment considerations, stating, “We want to make sure that we get the same or better consideration, if not the same, that is being given to Singapore.” He indicated the country’s goal to reclaim its position as a leading investment hub.
Moreover, Ramful promoted Mauritius as a strategic gateway for Indian investors seeking opportunities in Africa, a market with 1.3 billion consumers. He encouraged Indian investors to leverage Mauritius as a platform for investments in Africa, emphasizing the potential for growth through enhanced bilateral frameworks.
Indian High Commissioner to Mauritius, Anurag Srivastava, anticipates that India and Mauritius will sign significant agreements during Prime Minister Narendra Modi’s two-day state visit starting March 11, aimed at strengthening economic ties between the two nations.
In conclusion, Mauritius is actively seeking amendments to its trade agreements with India to restore its status as a preferred investment conduit amidst declining FDI inflows since the 2016 treaty revisions. The need for parity with Singapore and the emphasis on Mauritius as a gateway to Africa are central to its strategic vision to enhance bilateral economic ties. Upcoming discussions and potential agreements during Prime Minister Modi’s visit may further solidify this relationship.
Original Source: www.business-standard.com
