India-Mauritius Relations: Convergences & Challenges

Table of contents

During his two-day visit to Mauritius (March 11-12, 2025), Prime Minister Narendra Modi and Mauritian Prime Minister Navin Chandra Ramgoolam unveiled a Joint Vision for an Enhanced Strategic Partnership. They signed eight MoUs to boost banking, trade, security, and governance cooperation.

Key Outcomes of Visit

Strategic Partnership: A shared vision to deepen economic and security collaboration.
Eight MoUs Signed: Expanding cooperation in financial services, trade, cyber security, maritime security, and governance reforms.
New Mauritius Parliament: India to construct it as a “gift from the Mother of Democracy.”
Highest Civilian Honor: PM Modi was awarded Mauritius’s highest civilian award for his contributions to bilateral relations.
Launch of MAHASAGAR Initiative: A new vision for the Global South, focusing on trade for development, capacity building, and mutual security.

Key MoUs Signed Between India and Mauritius

Financial Cooperation: Agreement between the Reserve Bank of India and the Central Bank of Mau-ritius to establish a local currency settlement system.
Infrastructure Support: Credit facility agreement between the Mauritius government and the State Bank of India for the Central Water Authority’s Pipe Replacement Programme.
Diplomatic Training: Partnership between the Institute of Foreign Service of India and the Mauritius Ministry of Foreign Affairs to train diplomats.
Maritime Security: Technical agreement for white shipping information exchange between the Indian Navy and Mauritius Police Force.
Financial Crimes Investigation: Collaboration between the Financial Crimes Commission of Mauritius and India’s Enforcement Directorate.
MSME Development: MoU between Mauritius’ Ministry of Industry, SMEs, and Cooperatives and India’s Ministry of MSMEs to strengthen small businesses.
Public Administration Training: Agreement between Mauritius’ Ministry of Public Service and India’s National Centre for Good Governance for training public officers.
Oceanic Research Cooperation: Collaboration between India’s National Centre for Ocean Information Services & Mauritius’ Department for Continental Shelf, Maritime Zones Administration, & Exploration.

India-Mauritius Relations: A Historical Perspective

Significance of Mauritius for India

Strategic Geopolitical & Diplomatic Partner

Key Indian Ocean Ally: Mauritius is central to India’s Indo-Pacific strategy and Security and Growth for All in the Region (SAGAR) vision.
Support for India in Global Forums: Mauritius consistently backs India’s stance in international organisations like the UN and IORA (Indian Ocean Rim Association).
Chagos Archipelago Issue: India supports Mauritius’s sovereignty claim, reinforcing its position on decolonization and territorial integrity.

Economic & Trade Hub

FDI Contribution: Mauritius was the 2^nd largest source of FDI into India (FY 2023-24) after Singapore. It has contributed over $167 billion since 2000 due to favorable tax treaties.
CECPA Agreement (2021): The Comprehensive Economic Cooperation and Partnership Agreement boosted trade, with total bilateral trade reaching USD 554.19 million (2022-23).
Gateway to Africa: Mauritius, with its bilingual workforce (English & French) and financial ecosystem, serves as a crucial entry point for Indian businesses into Francophone Africa.

Security & Defense Cooperation

Naval & Maritime Security: India assists Mauritius in maritime surveillance, anti-piracy operations, and capacity-building initiatives under SAGAR.
Agaléga Island Development: India is investing in military infrastructure and surveillance facilities to enhance joint security efforts in the Indian Ocean.
Colombo Security Conclave Member: Mauritius collaborates with India, Sri Lanka, and the Maldives on counter-terrorism, maritime security, and disaster management.

Cultural & Diaspora Ties

People-to-People Bonds: Nearly 70% of Mauritius’s population is of Indian origin, fostering deep historical and cultural ties.
Promotion of Hindi: Mauritius hosts the World Hindi Secretariat, promoting Hindi globally and strengthening cultural diplomacy.
Educational & Research Exchange: India offers scholarships under ITEC, ICCR, and the Know India Programme (KIP) for Mauritian students.

Infrastructure & Development Cooperation

Major Infrastructure Projects: India has supported key projects like the Mauritian Parliament building and the Metro Express project.
Water Security Initiative: India extended a ₹487 crore rupee-denominated Line of Credit for replacing old water pipelines, marking its first rupee-based credit initiative.
Digital & Renewable Energy Partnership: India aids Mauritius in fintech, digital transformation, and renewable energy expansion.

Science & Technology Cooperation

E-Mobility & Green Energy: India supports renewable energy projects and electrification initiatives.
Fintech & Cybersecurity: Collaboration in digital governance, cybersecurity, and financial technology development.
Space Cooperation: India assists Mauritius in satellite tech, climate studies & disaster management.

Challenges in India-Mauritius Relations

Geopolitical Competition: Rising Chinese investments in Mauritius, including the Jinfei Smart City and port projects, challenge India’s strategic influence.
Declining FDI: FDI from Mauritius to India dropped from $15.72 billion (2016-17) to $6.13 billion (2022-23) after the 2016 DTAA amendment.
Maritime Security: Increasing piracy, drug trafficking, and illegal fishing threaten regional stability in the Western Indian Ocean.
Financial Irregularities: Concerns over money laundering and shell companies operating under Mauritius’ offshore banking system.
Trade Barriers: High logistics costs and limited direct shipping routes hinder bilateral trade expansion beyond $1.6 billion (2023-24).
Dependency on Indian Aid: Mauritius relies on Indian grants and $1 billion credit lines, impacting its economic diversification efforts.
Political Sensitivities: Mauritius’ domestic policies and balancing relations with China, France, and the USA complicate India’s engagement.
Taxation & Regulatory Issues: Tax treaty amendments led to a shift of foreign investments to Singapore, reducing Mauritius’ role as an FDI hub.

Way Forward

Deepening Strategic Cooperation: Establish an India-Mauritius Strategic Dialogue to enhance engagement under SAGAR, the Indo-Pacific framework, and the MAHASAGAR initiative.
Strengthening Trade & Investment: Expand CECPA, improve direct shipping connectivity, and create a Rupee-Mauritian Rupee payment mechanism to boost trade and investor confidence.
Enhancing Maritime Security: Strengthen naval cooperation, expedite Agaléga Island development, increase joint surveillance, and counter China’s expanding influence in the Indian Ocean.
Accelerating Development Initiatives: Prioritise green energy, digital infrastructure, water security, and blue economy projects for sustainable and inclusive growth.
Fostering Cultural & Diaspora Engagement: Promote Hindi, heritage exchanges, and educational scholarships while establishing a Pravasi Bharatiya Kendra to engage the Indian diaspora.
Enhancing Financial Integrity: Strengthen anti-money laundering cooperation, tighten financial regulations, and reinforce Mauritius’ role as a global financial hub post-DTAA amendments.
Advancing Geopolitical Collaboration: Support Mauritius’ sovereignty over the Chagos Archipelago while countering China’s strategic inroads through economic and security partnerships.

Reference: The Indian Express | PIB | PMFIAS: India-Mauritius Relations

PMF IAS Pathfinder for Mains – Question 111

Q. “Mauritius serves as India’s bridge to Africa.” In light of this statement, evaluate the role of Mauritius in India’s Africa outreach strategy and how it can be leveraged to enhance trade, investment, and diplomatic engagement. (250 Words) (15 Marks)

Approach

Introduction: Start the answer by highlighting Mauritius’ strategic location and historical ties with India, making it a gateway for India’s Africa outreach.
Body: Explain how Mauritius serves as a financial hub (DTAA, CECPA), trade and investment bridge, and diplomatic partner (AU, IORA).
Conclusion: Conclude by suggesting deeper economic integration, maritime security cooperation, and cultural diplomacy to enhance India-Mauritius-Africa ties.