PM’s Visit to Mauritius

Brief Context

The Prime Minister paid a state visit to Mauritius, his second since 2015.

Source Content

Syllabus: GS2/IR

Context

• The Prime Minister paid a state visit to Mauritius, his second since 2015.
  • He was the Chief Guest at Mauritius’ National Day Celebrations on March 12.

Key Highlights of the Visit

• MOUs Signed: Includes training civil servants, small and medium enterprises, blue economy development, combating financial crimes, and local currency settlement for trade.
• Indian Rupee Credit Line: A 487.6 crore INR line of credit for replacing water pipelines in Mauritius, a first-ever INR-based credit line.
• White-Shipping Agreement: Technical agreement for maritime security and information exchange.
• Award Conferred: PM Modi received the Grand Commander of the Order of the Star and Key of the Indian Ocean, marking him as the first Indian recipient.
• Vision for the Global South: PM introduced Vision MAHASAGAR (Mutual And Holistic Advancement for Security And Growth Across Regions), building on the previous Vision SAGAR.

About Mauritius

• Location: Mauritius is a strategically located island nation in the western Indian Ocean, close to India.

• Population: Nearly 70% of the population (1.2 million) is of Indian origin, strengthening ties with India.
• Colonial History: Mauritius was initially a French colony before becoming a British possession.
• National Day: Mauritius celebrates National Day on March 12, in honor of the date of Mahatma Gandhi’s Dandi March.

India- Mauritius Bilateral Relations

• Diplomatic Relations: India and Mauritius established diplomatic relations in 1948 and have become key trading partners in the Asian continent.
• Commercial Relations: For the FY 2022-2023, Indian exports to Mauritius was USD 462.69 mn, Mauritian exports to India was USD 91.50 mn and Total trade was USD 554.19 mn.
  • Double Taxation Avoidance Agreement: Signed in 1982 to help non-resident investors avoid double taxes.
  • CECPA Agreement: India and Mauritius signed the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) in 2021, India’s first trade agreement with an African country.
  • FDI Source: Mauritius is the second-largest source of Foreign Direct Investment (FDI) into India for FY 2023-24, after Singapore.
• Defence Relations: India is Mauritius’ preferred defence partner for acquiring platforms, capacity building, joint patrolling, hydrological services, etc.
  • First Agreement: Transfer of a Dornier aircraft and an Advanced Light Helicopter (Dhruv) to Mauritius on lease.
  • Second Agreement: A $100 million Line of Credit (LoC) for Mauritius to procure defence equipment.
• Space Cooperation: India and Mauritius are exploring space research opportunities and signed an MoU in November 2023 for developing a joint satellite.
• Indian Migration: French Rule (1700s): Indians from Puducherry were brought to Mauritius as artisans and masons.
  • British Rule (1834 – early 1900s): About half a million Indian indentured workers arrived in Mauritius.
    • The majority of these workers settled in Mauritius, influencing its culture and demographics.
• Development Partnership: India has been contributing to projects like the Metro Express, new hospitals, and infrastructure in Agaléga Island.
• Humanitarian Assistance: India assisted Mauritius during Cyclone Chido in 2023, showcasing India’s role as a “First Responder.”
• SAGAR: The term SAGAR – – ‘Security and Growth for All in the Region’  was coined by the PM in 2015 during his visit with a focus on the blue economy. 

Significance of Mauritius for India

• Strategic Location: Mauritius is strategically located in the Indian Ocean, crucial for India’s maritime security and trade routes.
• Agaléga island: It is located 1,100 km north of Mauritius, has strategic importance due to its proximity to the Indian southern coast. 
  • In 2024, India and Mauritius jointly inaugurated the air strip and jetty projects on the island, strengthening their bilateral cooperation.
• Countering China’s Influence: Strengthening ties with Mauritius is crucial for India to counter China’s growing presence in the Indian Ocean region.
• Geopolitical Competition: The Indian Ocean region is a hotspot for geopolitical rivalry, with countries like Europe, the Gulf, Russia, Iran, and Turkey expanding their influence.
• Cultural and Historical Ties: With nearly 70% of its population of Indian origin, Mauritius shares deep cultural, historical, and familial ties with India.
• Blue Economy: Mauritius is key to India’s interests in the Indian Ocean’s blue economy, especially for maritime resources, fisheries, and offshore energy exploration.
• Indian Ocean Cooperation: Mauritius plays a key role in regional organizations like the Indian Ocean Rim Association (IORA), contributing to regional stability and economic cooperation.

Areas of Concern

• Tax Treaty Misuse: The Double Taxation Avoidance Agreement (DTAA) between India and Mauritius had been a point of concern due to its potential misuse for illicit activities like money laundering and round-tripping of funds.
• Security Concerns: Mauritius is a key maritime entity in the Indo-Pacific, making security issues critical.
  • India and Mauritius have a strong defence partnership, but evolving regional dynamics pose challenges to maintaining and enhancing this relationship.
• Economic Challenges: Despite being major economic partners, there are concerns regarding trade imbalances and the need to diversify the trade basket.
  • Both countries may need to explore new avenues for trade cooperation and address any barriers that hinder the flow of goods and services.
• Presence of China: In recent years, several external powers, including China, have made increasing inroads in Africa and through the Indian Ocean.
  • In 2021, China’s Free Trade Agreement (FTA) with Mauritius came into effect.
  • This agreement will help China expand the Belt and Road strategy in Africa.
  • China’s increasing presence in the region will pose concerns for India.

Way Ahead

• The relationship between India and Mauritius is multifaceted and has grown stronger over the years. 
• Both nations can work towards expanding defense and security collaboration, including joint training, counterterrorism efforts, and maritime security.
• This multi-faceted approach can further solidify the longstanding relationship between India and Mauritius, contributing to mutual growth and regional stability.

Source: IE