A great deal of Foreign Direct Investment FDI to India comes from Mauritius than from many major and...........

Economic Affairs Foreign Investment

A great deal of Foreign Direct Investment (FDI) to India comes from Mauritius than from many major and mature economies like UK and France. Why?

India has preference for certain countries as regards receiving FDI

India has double taxation avoidance agreement with Mauritius

Most citizens of Mauritius have ethnic identity with India and so they feel secure to invest in India

Impending dangers of global climatic change prompt Mauritius to make huge investments in India

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Explanation:

DTAA allowed for aggressive tax saving to MNCs bringing in Foreign Investments through round tripping.

Current Update: Starting 1 April, 2019 capital gains on investments made in India through companies in Mauritius and Singapore will become fully taxable, as concessions cease to exist on the route, long seen as a tax-efficient way of investing in Asia’s third largest economy.