“Use Singapore as hub for global business”

Special Correspondent

CHENNAI: The Comprehensive Economic Cooperation Agreement signed between India and Singapore is having a dual effect: apart from boosting bilateral economic relations, it provides Indian businesses with a launch pad to China and South-East Asia.

At a seminar organised by the Madras Chamber of Commerce and Industry on Saturday, lawyers from the Singaporean firm Shook Lin and Bok explained how Indian firms could use Singapore as a hub for global business.

Senior advocate Philip Pillai said the island state could act as a bridge between India’s capital needs and international funding. “Singapore is a supermarket…It’s a one-stop-shop for global business. All the global players are here.”

Singapore’s extensive double taxation treaty network, especially the treaties with China that offer guaranteed investment protection, makes it a good base for Indian firms with a look-east policy.

According to Dr. Pillai, a good strategy for such firms would be to base themselves in Singapore and structure their business in such a manner so that at least 50 per cent of their activity would be in the ASEAN region. This way, they could take advantage of the low taxation due to Singapore’s agreements with other ASEAN economies as well as the ease of raising capital in the island, and still benefit from the low labour costs of ASEAN nations such as Thailand and Malaysia.

Hong Kong flaunted the same credentials as Singapore, but, Dr. Pillai said, the island state would be a better bet. “At the end of the day, you must remember that Hong Kong is China. Singapore is an independent country.”

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