Mauritius is seeking amendments to its DTAC with India to improve investment inflows, as FDI has sharply declined since 2016. Minister Dhananjay Ramful emphasized the need for discussions to revisit the CECPA agreement. A joint committee session will address outstanding issues and promote economic ties and cooperation in African markets.
Mauritius is advocating for changes in its Double Taxation Avoidance Convention (DTAC) with India, according to Foreign and Trade Minister Dhananjay Ramful. He stressed the importance of revisiting the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) to regain Mauritius’ status as a key investment conduit, particularly as foreign direct investment (FDI) has significantly decreased since the 2016 treaty amendment.
The discussion regarding DTAC amendments is ongoing, with Ramful noting that two critical issues need resolution before signing the protocol. A second session of the joint committee will soon address both the CECPA and DTAC to tackle trade imbalances and taxation concerns. Despite the signed CECPA, Mauritius has experienced a decline in exports to India.
Since 2000, Mauritius has invested a total of $175 billion in FDI into India, representing 25% of India’s overall FDI inflows. Post-2016 amendment measures aimed at curtailing tax avoidance have caused a drop in FDI from Mauritius, falling from $15.72 billion in 2016-17 to $6.13 billion in 2022-23. Nevertheless, Mauritius remains the third-largest FDI source for India as of the 2022-23 fiscal year, with a rebound to $7.97 billion in 2023-24, making it the second-largest source after Singapore.
Ramful expressed a desire for Mauritius to receive equivalent treatment to Singapore regarding investment incentives. He highlighted Mauritius as a strategic access point for Indian investors aiming at Africa’s market of 1.3 billion consumers. He encouraged Indian firms to utilize Mauritius as a launchpad for their investments across Africa. Recent Indian investments in Mauritius surpass $200 million over the last five years, a figure that Ramful anticipates will rise with improved bilateral relations.
The Indian High Commissioner to Mauritius, Anurag Srivastava, indicated that during Prime Minister Narendra Modi’s upcoming two-day state visit starting March 11, key agreements are likely to be signed to enhance economic collaboration between the two nations.
In summary, Mauritius is actively seeking amendments to its DTAC with India to enhance its investment appeal. Significant declines in FDI since 2016 underline the urgency of this need. The forthcoming joint committee meetings aim to address these concerns and restore Mauritius’ standing as a favorable investment destination. International cooperation between the two countries is expected to foster economic growth, particularly in accessing African markets.
Original Source: www.business-standard.com
