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February 2012: Mauritius: Strengthening ties with India

Ken EnDear Valued Investors,

It is with great pleasure that I present to you this new edition of our newsletter. The salient feature of the month remains the state visit of Dr. The Honourable Navinchandra Ramgoolam, GCSK, FRCP, Prime Minister of the Republic of Mauritius to India.

This visit to one of the fastest growing economies in the world opened up opportunities to further enhance longexisting relations and business ties that bind India and Mauritius. Not only is India our second most important trading partner today, but it equally ranks among the leading source countries of FDI into Mauritius.

The visit was seemingly foreordained since it followed the Indian Supreme Court judgment on the Vodafone court case. The judgment established that the Indian Revenue Authority does not have territorial jurisdiction to tax an offshore transaction, especially where payments were made offshore. This judgment has cleared lots of misunderstanding and it is most welcome by international financial centres like Mauritius.

During two high-profile business meetings organized in New Delhi and Mumbai, the Honourable Prime Minister delivered very reassuring speeches regarding the Double Taxation Avoidance Agreement between India and Mauritius. The importance of the agreement for investors cannot be sufficiently emphasized. The increasing visibility of Mauritius as the financial centre of the region, the clean jurisdiction of the Mauritian platform and its key role in partnerships with Indian corporates looking at exploring African ventures were equally highlighted by our Prime Minister. The messages were successfully carried across on various channels in the Indian media.

The business meetings in New Delhi and Mumbai were attended by 200 and 270 decision makers, respectively. There were representatives from leading Indian corporate firms from various fields including financial and legal services, pharmaceuticals, knowledge, manufacturing, property development, logistics and film production, amongst others.

Good contacts have been established with the members of the private sector delegation. BOI has already started receiving expressions of interests from a number of entrepreneurs involved in these sectors either regarding investments in Mauritius or the use of the Mauritian financial platform to access the African continent.

On the other side of the planet, even if the prevalent sluggishness and growing uncertainty in Europe do not augur anything bright in the short term, BOI keeps forging its way ahead with a close monitoring of investment projects in the pipeline. Our special task force is very active in its business facilitation role.

We concede that investment initiatives are getting spaced out. In fact, our forecast may require some adjustments if the investment environment remains strained due to global economic turmoil. However, we are pursuing our efforts to place the Mauritian platform in the trajectory of the “pull factor” where investors are looking for international acquisitions and investment opportunities to increase their global footprint. We maintain our determination to improve the business climate through technological advances, competitively priced skills and high quality service.

We invite you to go through the interview of Mr. Renaud Azema, the Managing Director of Vatel International Business School Hotel & Tourism Management. His testimony is a clear affirmation of MIKIF 2012, the international forum on knowledge and the tertiary educational sector, organised at the end of January. We are committed to transforming Mauritius into the centre of excellence of the region by attracting foreign universities of global repute to set up campuses locally. The forum has been a great booster to promote Mauritius as a knowledge hub.

BOI has been solicited to implement the International Fairs SME Refund Scheme which will allow small and medium enterprises to finance their participation in international fairs, thereby enhancing the visibility of the export platform. The services sector is the main target of the scheme.

On this note, I wish you all a very good reading and reassure you of our commitment to give you our highest level of service and assistance toward the timely materialization of your projects.

Ken Poonoosamy

Managing Director