India and Iran today signed an agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with regard to taxes on income. The agreement is on similar lines as entered into by India with other countries, the Central Board of Direct Taxes (CBDT) said in a statement. “The agreement will stimulate flow of investment, technology and personnel from India to Iran and vice-versa, and will prevent double taxation,” the statement said.

The pact provides for exchange of information between the two nations in line with the latest international standards. “It will improve transparency in tax matters and will help curb tax evasion and tax avoidance,” the statement said. “The agreement also meets treaty related minimum standards under G-20 OECD Base Erosion and Profit Shifting (BEPS) Project, in which India participated on an equal footing.”

Earlier in the day, addressing industry association FICCI, the Iranian Economic Affairs and Finance Minister Masoud Karbasian invited Indian business to invest in Iran and take advantage of the rapid economic growth of the country. “We hope that by signing the basic economic and trade agreement such as the avoidance of double tax, supporting joint venture plans as well as preferential tariffs, would enable companies to enter Iran with fewer obstacles,” he said.

“In view of the positive outcome of the nuclear deal, Iran has started to gather momentum...We have set an 8 per cent economic growth target,” he said. Citing various advantages of Iran, he said, the country has been a safe provider for Indian petroleum companies for importing petrochemical products.Chabahar is the symbol of multilateral transit cooperation, he said, adding that it is also a golden opportunity for investment for Indian corporates in the field of petrochemicals.