India-Qatar Current Affairs
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The Union Cabinet has given its approval for revision existing Double Taxation Avoidance Agreement (DTAA) between India and Qatar. The purpose of revision is for avoidance of double taxation and for prevention of fiscal evasion with respect to taxes on income. The existing DTAA between India and Qatar was signed in April 1999 and came into force in January, 2000. The
Features of Revised DTAA
- It updates provisions for exchange of information to latest standard. It includes Limitation of Benefits (LOB) provision to prevent treaty shopping and aligns other provisions with India’s recent treaties.
- It meets minimum standards on treaty abuse under Action 6 and Mutual Agreement Procedure under Action 14 of G-20 OECD Base Erosion & Profit Shifting (BEPS) Project to which India is participating.
Under it, a resident of third country invests by taking advantage of fiscal treaty between India and another contracting state. This has greatly contributed in encouraging FDI in country but has been medium of tax evasion. The roots of Treaty shopping are in inconsistencies among international tax regimes. If there is dissimilarity of tax systems, it can lead to distortion of investment flows. It can be controlled by introduction of limitation of benefit clause (LOB) and other clauses which limit benefits to residents of two countries only.
India and Qatar have signed five agreements including in the field of visas, cyberspace and investments.
These agreements were signed after bilateral talks held between Prime Minister Narendra Modi and his Qatari counterpart Sheikh Abdullah bin Nasser bin Khalifa Al Thani in New Delhi.
Singed Agreements are
- Protocol on Technical Cooperation in cyber space and combating cybercrime.
- Letter of Intent on an Agreement on grant of e-Visa for businessmen and tourists
- MoU on greater collaboration and exchange in the field of national ports management.
- Agreement on exemption from visa requirement for holders of diplomatic, special and official passports.
- MoU between Qatar’s Supreme Committee for Delivery and Legacy and Confederation of Indian Industry (CII).
Both sides held bilateral talks on key issues of energy, trade and security. India expressed its keenness to invest in hydrocarbon projects in Qatar. They also agreed to enhance cooperation in defence and security in particular in cybersecurity and jointly tackle money laundering and terrorist financing. Qatar welcomed Indian investment in the port sector of Qatar. It also invited India’s participation in infrastructure and investment opportunities coming up in the wake of Qatar hosting the FIFA World Cup in 2022. They also discussed the regional situation, particularly in Iraq, Syria and Yemen.
India enjoys close and friendly relations with Qatar. The relationship is based on mutually beneficial commercial exchanges and extensive people-to-people contacts. Qatar is one of the most important trading partner of India in the Gulf region and important contributor to India’s energy security. It is the largest supplier of LNG to India, accounting for 66% of the total imports in 2015-16. Indians form the largest expatriate community (around 630,000) in Qatar. They have provided positive contribution in the progress and development of Qatar.