NEW DELHI: President Pratibha Patil begins on Sunday a four-day trip to Mauritius, the country which accounts for over 40 percent of foreign direct investment (FDI) into India.
Mauritius figures in India’s black money debate. But the issue is not specifically on the agenda of her state visit to the island-nation, important to India mainly because of its overwhelming largeIndian Diaspora.
Capital that travels the ‘Mauritius route’ often comes under suspicion of being black money, laundered white. Tax-avoiders make use of the low corporate taxes in the Indian Ocean country and its double tax avoidance treaty with India.Between 2000 and 2009, nearly US $ 50 billion in FDI - or about 44 percent of the total investment into India - came from Mauritius. Skeptics say that a significant chunk of it could be laundered black money that originated in India in the first place.Of late, both India and Mauritius have indicated there will be a stricter vigil on transactions which indicate attempts to legitimise black money. There is also talk of renegotiation of the double tax avoidance agreement.
Despite black money concerns, Delhi is keen to boost trade and investment with Mauritius. An Indian delegation of 57 businesspeople will be in Mauritius during the President’s visit. Patil will also address an India-Mauritius business meet.