Pakistanis angry over detentions in Times Sq. case Monday, May 24, 2010
ISLAMABAD – Relatives of three men detained by Pakistan for alleged links to the suspect in the attempted Times Square bombing say the men are innocent.
They
AFP - Thursday, August 6TAIPEI (AFP) - - Taiwan's Beijing-friendly government on Wednesday denied boycotting an Australian film festival amid a row over the e
BERLIN (Reuters) - Chancellor Angela Merkel suffered a double blow on Thursday as a senior party ally in east German
Minister seeks closure of anti-Berlusconi websites Wednesday, December 16, 2009
ROME (AFP) - – The Italian government moved Tuesday to close down Internet sites encouraging further violence against Prime Minister Silvio Berlusconi, who
By ELAINE KURTENBACH,AP Business Writer AP - Wednesday, March 18SHANGHAI - Asia's stock market rally seemed to be running out of steam Wednesday, despite an
Edition:
U.S.
Africa
Arabic
Argentina
Brazil
Canada
China
France
Germany
India
Italy
Japan
Latin America
Mexico
Russia
Spain
United Kingdom
Home
Business
Business Home
Economy
Technology
Media
Small Business
Legal
Deals
Earnings
Social Pulse
Business Video
The Freeland File
Markets
Markets Home
U.S. Markets
European Markets
Asian Markets
Global Market Data
Indices
M&A
Stocks
Bonds
Currencies
Commodities
Futures
Funds
peHUB
World
World Home
U.S.
Brazil
China
Euro Zone
Japan
Mexico
Russia
India Insight
World Video
Reuters Investigates
Decoder
Politics
Politics Home
Election 2012
Issues 2012
Candidates 2012
Tales from the Trail
Political Punchlines
Supreme Court
Politics Video
Tech
Technology Home
MediaFile
Science
Tech Video
Tech Tonic
Social Pulse
Opinion
Opinion Home
Chrystia Freeland
John Lloyd
Felix Salmon
Jack Shafer
David Rohde
Bernd Debusmann
Nader Mousavizadeh
Lucy P. Marcus
David Cay Johnston
Bethany McLean
Edward Hadas
Hugo Dixon
Ian Bremmer
Lawrence Summers
Susan Glasser
The Great Debate
Steven Brill
Jack & Suzy Welch
Breakingviews
Equities
Credit
Private Equity
M&A
Macro & Markets
Politics
Breakingviews Video
Money
Money Home
Tax Break
Lipper Awards 2012
Global Investing
MuniLand
Unstructured Finance
Linda Stern
Mark Miller
John Wasik
James Saft
Analyst Research
Alerts
Watchlist
Portfolio
Stock Screener
Fund Screener
Personal Finance Video
Money Clip
Investing 201
Life
Health
Sports
Arts
Faithworld
Business Traveler
Entertainment
Oddly Enough
Lifestyle Video
Pictures
Pictures Home
Reuters Photographers
Full Focus
Video
Reuters TV
Reuters News
Article
Comments (0)
Full Focus
Photos of the week
Our top photos from the past week. Full Article
Images of February
Follow Reuters
Facebook
Twitter
RSS
YouTube
Read
Top Obama aides hit back at Romney over Russia
01 Apr 2012
Weather Service to test more graphic tornado warnings
01 Apr 2012
Romney falls for elaborate April Fool's prank
01 Apr 2012
Russian plane crash kills 31, 12 survive
3:51am EDT
Brotherhood presidency bid turns up heat in Egypt race
01 Apr 2012
Discussed
259
Poll: Americans angry with Obama over gas prices
189
Supreme Court weighs all-or-nothing on healthcare law
149
Supreme Court moves to heart of healthcare case
Watched
Urine eggs a delicacy in China
Thu, Mar 29 2012
Fishermen saved in Russian Far East.
Sun, Apr 1 2012
Horror hits the runway in Japan
Fri, Mar 23 2012
Global business groups warn India over tax plan impact
Tweet
Share this
Email
Print
Related News
REFILE-UPDATE 1-Vodafone mulls action after "unjust" India tax proposal
Fri, Mar 30 2012
BRICS flay West over IMF reform, monetary policy
Thu, Mar 29 2012
Goldman kicks off Indian charm offensive
Thu, Mar 29 2012
Insight: Life and death on India's slow train to prosperity
Thu, Mar 22 2012
UPDATE 4-India joins China in boycott of EU carbon scheme
Thu, Mar 22 2012
Analysis & Opinion
Playing the pension game
Hooked on drug ads, education collision in Hawaii, and the gas frenzy
Related Topics
World »
Indian Prime Minister Manmohan Singh attends a joint news conference with European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy at the EU-India summit in New Delhi February 10, 2012.
Credit: Reuters/B Mathur
By Henry Foy
MUMBAI |
Mon Apr 2, 2012 4:06am EDT
MUMBAI (Reuters) - International trade groups representing more than 250,000 companies have warned Indian Prime Minister Manmohan Singh that new taxation proposals by his government have led foreign businesses to reconsider their investments.
India's federal budget last month outlined proposals that would allow authorities to make retroactive tax claims on overseas deals and bring in new anti-tax-avoidance measures, moves that have been criticized for further denting investor sentiment towards India.
The warning, contained in a letter from seven overseas business groups, is the broadest criticism yet by the overseas business community of an Indian government that has failed to enact economic reforms to spur investment and revive growth, and was sent days before George Osborne, Britain's finance minister, was to hold talks on Monday with his Indian counterpart.
"The sudden and unprecedented move...has undermined confidence in the policies of the Government of India towards foreign investment and taxation and has called into question the very rule of law, due process, and fair treatment in India," the groups said in a March 29 letter addressed to Singh and seen by Reuters.
"This is now prompting a widespread reconsideration of the costs and benefits of investing in India," continued the letter, signed by bodies including the U.S.-based Business Roundtable, the Confederation of British Industry, the Japan Foreign Trade Council and Canadian Manufacturers & Exporters.
The Business Roundtable is chaired by Boeing Co Chief Executive James McNerney and represents companies with more than $6 trillion in revenue.
India's reputation among global investors has taken a beating over the past year, as the government has lurched from crisis to crisis, including a botched attempt to allow foreign supermarkets into the country and a long-running stand-off with South Korea's POSCO over a $12 billion steel plant.
Sluggish investment is partly to blame for slowing growth in Asia's third-largest economy, which grew 6.1 percent in the December quarter, but the weakest in nearly three years.
Osborne was to meet Indian Finance Minister Pranab Mukherjee on Monday, and the issue of retrospective taxation on mergers outside of India was expected to be discussed.
INCREASING UNCERTAINTY
A long-running tax struggle between London-listed Vodafone Group Plc, India's largest overseas investor, and the Indian government has come to symbolize the perils to foreign investors in the country.
Vodafone won a five-year legal battle in January when India's Supreme Court dismissed a $2.2 billion tax demand from authorities over the British company's acquisition of Hutchison Whampoa Ltd's Indian mobile assets in 2007.
That ruling was hailed by business groups as a victory for clarity in the country's investment climate, which has suffered due to policy paralysis, regulatory uncertainty and widespread corruption allegations against the government.
But the proposal in the recent budget to retroactively impose tax on deals conducted overseas where the underlying asset is located in India would amend 50-year-old-tax laws and allow New Delhi to pursue tax on long-concluded transactions.
Parliament is expected to consider the proposals during the last week of April.
"Some of our member companies had already begun re-evaluating their investments in India due to increasing levels of controversy and uncertainty regarding taxation in recent years," the letter said.
Vodafone said last week it was considering a number of actions after the proposal, which it said was "grossly unjust".
Policy confusion in India's telecom sector over the tainted allocation of mobile licenses in 2008 has recently seen Abu Dhabi's Etisalat announce the winding down of its Indian operations.
Norway's Telenor has also been embroiled in a dispute with its Indian partner, Unitech Ltd, and has said it would seek to migrate the business to a fresh venture with a new partner.
The tax proposal, if written into law, could also affect Kraft Foods Inc's 2010 acquisition of Cadbury's Indian business and deals involving Indian assets sold by AT&T Inc and SABMiller Plc's purchase of Fosters.
In the letter, also sent to the Indian finance minister, the business groups said a plan to expand the definition of "royalty" retrospectively to 1976 would affect companies such as Ericsson.
"There appears to be an assumption, often expressed by Indian tax authorities, that India's ability to attract foreign investment is not affected by its taxation policies and practices. This simply is not the case," the letter continued.
"India will lose significant ground as a destination for international investment if it fails to align itself with policy and practice around the world," it said.
(Additional reporting by Matthias Williams in NEW DELHI; Editing by Tony Munroe and Raju Gopalakrishnan)
World
Related Quotes and News
Company
Price
Related News
Tweet this
Link this
Share this
Digg this
Email
Reprints
We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (0)
Be the first to comment on reuters.com.
Add yours using the box above.
Edition:
U.S.
Africa
Arabic
Argentina
Brazil
Canada
China
France
Germany
India
Italy
Japan
Latin America
Mexico
Russia
Spain
United Kingdom
Back to top
Reuters.com
Business
Markets
World
Politics
Technology
Opinion
Money
Pictures
Videos
Site Index
Legal
Bankruptcy Law
California Legal
New York Legal
Securities Law
Support & Contact
Support
Corrections
Connect with Reuters
Twitter
Facebook
LinkedIn
RSS
Podcast
Newsletters
Mobile
About
Privacy Policy
Terms of Use
AdChoices
Copyright
Our Flagship financial information platform incorporating Reuters Insider
An ultra-low latency infrastructure for electronic trading and data distribution
A connected approach to governance, risk and compliance
Our next generation legal research platform
Our global tax workstation
Thomsonreuters.com
About Thomson Reuters
Investor Relations
Careers
Contact Us
Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.
NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.