20 May 2016

DTAA - From cooperation to revision

When PM Modi made the Indian Ocean islands of Sri Lanka, Mauritius and Seychelles the subject of one of his first overseas trips, our destination was favoured and honoured not only by the timing (coinciding as Guest of Honour at our National Day celebrations) and the optimistic mood that bathed two leaders and two countries that had just witnessed a sweeping electoral change of guards. Both leaders had undoubtedly made landmark promises to their respective electorates but most observers here naturally expected that our common tryst with geography, history and culture, our confident strategic relationship extending far beyond friendship between India and its most loyal friend and ally in this part of the world, would be taken to new heights.


The Indian Ocean routes channel major and strategic maritime traffic and securing such trade had long been left to traditional superpowers, although China, not particularly keen to prolong such strategic dependence on the West, was increasingly using mega-bucks financing to help project its rising naval muscle in an area where it had little geographical or historical legitimacy. PM Modi, determined to take India on a carefully planned new geopolitical trajectory as a regional power, could not remain insensitive to its own “backwaters”. India of course has had a massive role in all sectors of our economy but Modi clearly felt the urge to alter years of “benign neglect” on the security and strategic fronts...

At the end of this strategic visit (of Narendra Modi) in March 2015, there was no cloud on the horizon, there was no inkling that the cooperative spirit to limit abuse of the DTAA from the two statesmen, could in July 2015 turn into a source of considerable controversy locally, putting our banking and offshore financial sector under heavy risks, with potential contagion to other economic spheres, if we go, that is, by the IMF and Moody assessments. What turned sweet grapes so sour in those four fateful months? Was it just a matter of amateurism and inexperience of technical and political staffers, facing vastly more astute and resilient Indian counterparts?

Mauritius Times

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