Investors find new routes to Indian JVs

Author: Brian Yap | Published: 30 Sep 2016

Foreign investors are setting sights on new markets with stable tax regimes through which to route their investments into India, according to speakers at this year’s IFLR India M&A Forum in Mumbai.

India and Mauritius signed a new deal in May to amend the 1983 India-Mauritius Treaty, with both sides agreeing on the removal of the existing tax exemption for gains from the transfer of Indian securities by a Mauritius resident.

According to panellists this has already resulted in foreign investors seeking to restructure their India-bound investments through Singapore, which has a more stable tax regime.

"The changes to the Indo-Mauritius tax treaty have been a game changer in the way in which foreign investment in Indian joint ventures is being structured," said Delano Furtado, partner at Trilegal in Mumbai. He added that the tax structuring aspects of such investments will change considerably going forward. ...