Mauritius Advocates for Amendments to Trade Agreements with India

Mauritius is seeking amendments to its trade agreements with India, particularly the Double Taxation Avoidance Convention, citing a significant decline in foreign direct investment since 2016. Minister Dhananjay Ramful emphasized the need to restore Mauritius’ status as a preferred investment conduit while promoting the nation as a strategic gateway to Africa. The country aims for parity with Singapore in FDI considerations and anticipates significant agreements to strengthen economic ties with India during an upcoming visit by Prime Minister Modi.

Mauritius is advocating for amendments to its trade agreements, specifically the Double Taxation Avoidance Convention (DTAC) with India, as stated by Foreign and Trade Minister Dhananjay Ramful. In a recent interview with PTI Videos in Port Louis, he highlighted the necessity to review the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) in order to restore Mauritius’ status as a favored investment conduit, particularly as foreign direct investment (FDI) from Mauritius to India has significantly declined since the treaty was revised in 2016.

The discussions surrounding the amendment of the DTAC are ongoing. Minister Ramful mentioned that two primary issues require resolution before a protocol can be signed, indicating areas of contention in the negotiations. He announced that a second session of the joint committee will meet soon to reassess both the CECPA and the DTAC, with the objective of addressing deficiencies in trade and taxation.

Since the year 2000, Mauritius has invested a cumulative $175 billion in FDI into India, which constitutes 25 percent of India’s total FDI inflows. However, following the 2016 amendment that introduced measures to reduce tax evasion, FDI from Mauritius fell sharply from $15.72 billion in 2016-17 to $6.13 billion in 2022-23. Nonetheless, Mauritius remains India’s third-largest source of FDI. For the fiscal year 2023-24, FDI from Mauritius rebounded to $7.97 billion, making it the second-largest source after Singapore.

Minister Ramful also underlined Mauritius’ ambition for equal treatment alongside Singapore, seeking to ensure comparable or improved considerations for Mauritius. Furthermore, he promoted Mauritius as a strategic hub for Indian investors aiming to penetrate Africa’s consumer market of 1.3 billion. He stated that Indian investors should recognize Mauritius as a viable platform facilitating investments in Africa.

In the past five years, Indian companies have invested over $200 million in Mauritius, a figure that Minister Ramful expects to increase with improved bilateral frameworks. In a related note, Anurag Srivastava, the Indian High Commissioner to Mauritius, indicated that significant agreements are anticipated during Prime Minister Narendra Modi’s state visit starting March 11, aiming to strengthen economic relations.

In conclusion, Mauritius is actively seeking revisions to its trade agreements, particularly the DTAC with India, in response to declining foreign direct investment since the 2016 treaty amendment. Minister Ramful’s emphasis on enhancing economic ties and reforming bilateral agreements reflects Mauritius’ commitment to recapturing its investment appeal and positioning itself as a gateway for Indian investors targeting the African market.

Original Source: www.business-standard.com