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26 Feb 2021
BY Elsie Rasolohery Pascal , Martine de Fleuriot de la Colinière , Thierry Koenig AND Yashna Munbauhal

Free trade pact between Mauritius and India: a strategic opportunity to explore new horizons

In these hard economic times, businesses in Mauritius are welcoming the signing of the Mauritius-India Comprehensive Economic Cooperation and Partnership Agreement (the “CECPA”) on 22 FEB 2021. 

The terms of the CECPA have been in negotiation since 2005. Now that it is signed, it is a pivotal milestone in the long-standing relationship between the two countries as it is the very first trade agreement that India has signed with any country in Africa. The CECPA will come into force from the first date of the following month.

The CECPA covers:

  • trade in goods; 
  • rules of origin;
  • trade in services; 
  • technical barrier to trade (TVT); 
  • sanitary and phytosanitary  (SPS) measures; 
  • dispute settlement;
  • movement of natural persons;
  • telecoms; 
  • financial services; 
  • customs procedures; and 
  • cooperation in other areas.

For Mauritius, this strategic alliance is in line with its position as a regional hub in the Asia-Africa corridor. The CECPA will have a tremendous economic impact, as it will cut or eliminate duties on majority of goods as well as liberalise norms to promote services trade and boost investments in the Island.

As communicated by the Ministry of Ministry of Foreign Affairs, Regional Integration and International Trade:

The chapter on Economic Cooperation provides a framework for cooperation in 25 key areas including manufacturing, pharmaceutical, ICT, financial sector, blue economy, SME development and joint strategies for investment in Africa.

 

On services, the CECPA will open market access in sectors such as financial services, tourism, education, distribution, ICT and professional services.

This will also allow market access at concessional customs duties for Indian exports to Mauritius.

Mauritius will benefit from preferential market access on a list of 615 products, including:

  • Duty free access on 376 products
  • 40 000 tons at 10% duty compared to 100% duty on special sugar
  • 2-million litres of beer at 50% duty, compared to 150% duty
  • 1.5-million litres on rum at 50% duty compared to existing duty of 150%
  • 5 000 litres at 50% duty compared to current duty of 150% on fruit wine
  • 7.5-million pieces duty free on garments
  • 7 000 tons duty free access on canned tuna

Mauritius on its part will provide preferential access for 310 products, with tariff rate quotas for 88 products which limit the volume or value of preferential imports from India to protect the domestic industry.

It was also highlighted that Mauritius and India have agreed to negotiate an Automatic Trigger Safeguard Mechanism for a limited number of highly sensitive products within two years of signing the CECPA. 

While there is no doubt that this trade pact will significantly boost trade between Mauritius and India and further strengthen the Indo-Mauritian relationship, the CECPA marks a new step in the partnership between India and the African continent.

For information on the CECPA, please contact:

Thierry Koenig SA
Head of ENSafrica | Mauritius
tkoenig@ENSafrica.com
+230 5729 9990

Martine de Fleuriot de la Colinière
ENSafrica | Mauritius | Director | Barrister
mdefleuriot@ENSafrica.com
+230 5422 1881

Elsie Rasolohery Pascal
ENSafrica | Mauritius | Executive
epascal@ENSafrica.com
+230 5492 3558

Yashna Munbauhal
ENSafrica | Mauritius | Barrister | Associate
ymunbauhal@ENSafrica.com
+230 5970 4182