India and Mauritius will resume talks in April to carry further the discussions on reviewing certain provisions of a bilateral double taxation avoidance convention.
President Pranab Mukherjee and Prime Minister Navin Ramgoolam of Mauritius said in a statement issued at the end of their meeting on Tuesday that the two countries were working out the finer details of the convention.
Dr. Ramgoolam expressed the hope that a solution would be found at the meeting scheduled for April. The two countries have “already found some common ground” and there should be a solution soon.
Mr. Mukherjee, in turn, said: “I am pleased to note that the Joint Working Group [JWG] on the Double Taxation Avoidance Convention has met twice in the last one year. They have provided an opportunity to both sides to discuss all issues with the aim of finding a mutually acceptable and beneficial outcome. India looks forward to holding the next meeting of the JWG soon in New Delhi. We also look forward to the holding of the 11th India-Mauritius Joint Commission Meeting.”
The JWG had met in August 2012 and December 2011. The JWG meetings assume importance, given India’s concerns at possible misuse of the tax avoidance treaty. Mauritius is often seen a conduit for routing untaxed funds to and from India. More recently, an announcement in his budget speech by Finance Minister P. Chidambaram on making the Tax Residency Certificate (TRC) “a necessary but not sufficient” condition to avail oneself of the benefits under the treaty had created some confusion among investors in India and abroad, particularly among those using Mauritius to do business with India. However, the Minister has since clarified that “the income tax authorities in India will not go beyond the TRC and question [an investor’s] residence status” or beneficial ownership for claiming benefits under the India-Mauritian DTAC.
New Delhi attaches importance to its ties with Mauritius given the island nation’s geostrategic location and because 38 per cent of foreign direct investment in India comes from that country. Also, 70 per cent of the Mauritian people are of Indian origin.
In an indication of India’s growing interest in Mauritius, Mr. Mukherjee said: “Mauritius is the second country I am visiting after assuming the post of President of India. This reflects the importance that India attaches to its relationship with Mauritius.”
Mr. Mukherjee said India was willing to continue extending assistance to Mauritius in human resource development and capacity-building. “We have already increased the training slots for Mauritius under the Indian Technical and Economic Cooperation (ITEC) programme to 170 for civilian programmes and 100 for defence-related programmes. These slots can be increased to meet further demands. It is heartening to note the rise in the number of Mauritian students availing themselves of the 100 educational scholarships offered by the Government of India annually,” he said.
Referring to other areas of cooperation, Mr. Mukherjee said India was committed to the safety and security of Mauritius and would continue to work towards enhancing the cooperation in anti-piracy efforts. Indian naval ships would continue joint anti-piracy and exclusive economic zone surveillance exercises with their Mauritian counterparts to ensure maritime security in these waters.
Dr. Ramgoolam thanked India for its cooperation in various fields and said the Blue Ocean economy was also part of the discussions with the visiting Indian delegation. He thanked India for sharing hydrographical surveys with Mauritius for free and helping the Mauritian economy grow to where it is now.
Mr. Mukherjee was accorded a red-carpet welcome in Port Louis on his arrival on Monday. Dr. Ramgoolam received him at the airport amid a ceremonial 21-gun salute. Speaking at a banquet hosted in his honour by Dr. Ramgoolam on Monday, the President said India and Mauritius had a “convergence of interests” as the Indian Ocean straddled Asia and Africa. For several millennia, the Indian Ocean had been a key arbiter of the subcontinent’s fortunes and Mauritius was the “proverbial Star and Key of the Indian Ocean.”
Earlier on Monday, Mr. Mukherjee held talks with his Mauritian counterpart Rajkeswur Purryag.
