India and Mauritius have agreed to push forward their negotiations for a long pending revision of Double Taxation Avoidance Treaty (DTAT), asserting that their objective is to prevent the “abuse” of the convention.

Prime Minister Narendra Modi and his Mauritian counterpart Sir Anerood Jugnauth expressed this resolve during their talks here last night even as India offered $500 million concessional line of credit to this key island nation for key infrastructure projects.

Negotiations to amend the bilateral tax treaty have been hanging fire for a long time amid India’s apprehensions that it is being misused to route unaccounted money and evade taxes.

The two countries also signed five agreements, including one on developing ocean economy, after talks between Modi and Sir Anerood on the first day of his two-day visit to Mauritius on the second leg of this three—nation tour that will also take him to Sri Lanka tomorrow.

On other key bilateral economic issues, Modi said the two countries should resume their discussions on Comprehensive Economic Partnership Agreement.

In his response, Jugnauth said the Preferential Trade Agreement signed in August 2006 to further enhance market access should be reviewed and that the two countries have agreed on the way forward.

Addressing a joint news conference with Modi, Jugnauth said he had raised with the Indian Prime Minister issues related to the Mauritius—India Double Taxation Avoidance Agreement (DTAA).

“We appreciate that already India postponed the consideration of the GAAR until 2017. However, we have stressed on the initiatives taken by Mauritius to build substance within our offshore jurisdiction. I have requested PM Modi to give his full support on the DTAA as it is of prime importance for our global business sector,” he said.

Modi in his response said the two sides agreed to continue negotiations for a revised treaty based on shared objectives to prevent the “abuse” of the convention.

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