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'We plan to boost IT sector in Mauritius with Indian help'

His sensational rise to the political pinnacle in Mauritius for the first time in 1982, his aggressive approach to government- and party-formation, his sustained efforts at shoring up the economy through global lobbying and regional deal-making, have earned Prime Minister Sir Anerood Jugnauth the nickname of 'Mauritian Juggernaut'.

Sure enough, Sir Anerood, 70, sought to live up to that image during his first-ever state visit to India, also the first one by the head of the Mauritian government after the infamous Sensex meltdown of April 4, 2000. He brushed aside remarks that his country has become a haven for fraudulent companies keen on evading taxes in India. His hardsell of investment opportunities in Mauritius, he said, has convinced Indian businessmen so much that they have promised to set up shop.

In an interview with Associate Editor Y Siva Sankar, Sir Anerood explained how economic and corporate co-operation between India and Mauritius can help entrepreneurs to generate more wealth and spread prosperity in the region.

What kind of feedback/response have you received so far from Indian businessmen and companies to your invitations for investments?

We have had discussions. I must say their response has been very good, very positive. Many groups have promised that they would invest in my country. I am hopeful that they would keep their word.

They belong to different industries. For example, textiles, tourism. But I've insisted that they -- the Indian entrepreneurs -- should help us where we need most help, and this is IT.

A few groups are prepared to come. But there are already in Mauritius a couple of groups; they have already settled down, invested in the IT sector. It's not as if no Indian groups are in Mauritius.

The inflow of foreign investments has already started. I want to give it a boost.

India itself is seeking foreign investments. So why these invitations for Indian investments in Mauritius?

It is never enough. All countries seek foreign investments, including the United States which continues to get foreign investment. So this is sort of a cycle that will go on.

What are your expectations at the end of your visit to India?

Well, I'm expecting a lot. I did not come to India because we were expecting this or that. India and Mauritius have a very long historical relationship. Seventy per cent of the Mauritian population is of Indian descent.

This is not the first time that I've come to India. I visited India even when I was the leader of Opposition and prime minister earlier. I've recently been appointed prime minister again. This is my first state visit.

The main aim of this visit was to enlist India's support to boost the information technology sector in Mauritius. When I lost the prime ministerial election in 1995, I already had a plan to promote this sector in Mauritius.

Unfortunately, during the five years I was away from power, nothing much has been done. Therefore, the progress got delayed. There is a big gap.

India has taken a tremendous lead in the information technology sector. I think India can help us a lot.

We've talked not only with the government but also the private sector. They are all keen to help us.

I'm very optimistic that positive results will come out of this visit.

Last year, Mauritius sought to levy a 15 per cent flat tax on net income of offshore corporations. Shortly thereafter, the decision was put off to July 2003, apparently because foreign institutional investors exerted pressure on the government. Would you review this decision?

I didn't do this. My predecessor did. I'm going to look into this matter. I don't believe in big taxes. No. I think we must be very fair if we want to really make the country prosper.

How has your economy benefited by being the tax-haven for the FIIs?

Of course, the Mauritian economy has benefited a lot. We get a lot of sources of income. We get jobs for our people, white-collar jobs. It is a source of revenue and investment.

It is said that most of the foreign companies registered in Mauritius have a mere letterhead presence, that they exist to avoid paying taxes in India.

Well, it's not true. In fact, some people have raised this question. But they have not really understood the exact situation.

In fact, India is benefiting a lot. One-third of the foreign investments in India came through Mauritius. And thanks to the arrangement between Mauritius and India, it's not Mauritius alone that is benefiting.

We are also benefiting, sure. But it is mutual. And I must say that India is benefiting more.

So why should we be against foreign companies' presence in Mauritius?

Mauritius has preferential access to European markets. However, all this will change in the WTO regime. What steps are you taking to ensure that you will not only survive but prosper in the new world trade order?

Yes, Mauritius produce and goods were given a lot of preference in export markets under the Lome Convention. Now, the successor to that agreement, called the Cotonou Agreement, still offers us privileged access to some markets outside Mauritius.

If Indian entrepreneurs come to Mauritius, whatever they manufacture, will get the same facilities and preferential access to the European Union market, the African market and the US market as Mauritian companies. So it is an opportunity Indian entrepreneurs would do well to exploit.

What we want to make of Mauritius is a hub, a bridge between Asia and Africa.

Are you looking at any fields besides the IT sector?

Of course. We are eyeing many other fields. For example, in light industries, tourism, offshore financial sector, there is scope. Indian entrepreneurs can take advantage of the facilities we have to export to some African countries where people speak French, the US and the European Union.

There are other investors coming to Mauritius. But we would like to see Indian investors also in Mauritius to take part in the country's progress.

It is said you are offering lots of incentives to those who invest in Mauritius. How competitive are your incentives?

Well, we are going to start, so far as the IT sector is concerned, with a Cyber City where there will be all the facilities. This will be a great help to prospective investors. They can avail of the infrastructure facilities with all amenities and thus save on costs.

After I became the prime minister, we have set up an institution called the Board of Investment which, in due course, will become a one-stop shop for clearances. So, this will facilitate investors a lot. They will not have to run from ministry to ministry. All these bureaucratic things -- we are trying to eliminate.

Mauritius seems a preferred overseas destination for most of the Indian film-makers. Do you have any plans to cash in on this trend?

We are already providing certain facilities to film-makers. Mauritius has lovely beaches, nice seaside getaways... the natural scenery itself is enough to attract people by the droves.

Now we want to discuss and see what else we can do to facilitate further their shooting of films, etc.

You lead a left-wing party in Mauritius. India is being governed by a coalition led by the right-wing BJP. Both of you are seeking foreign investments. Is there a lesson in this?

(Laughs.) I don't know what is left-wing, what is right-wing. We have no wings. We don't fly. (Laugh again.)

But we want to be practical, we want to be realistic, we want to tackle the real problems of the country, and make the country prosper and move forward. I am sure that is the motive of the Indian government also.

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