Thursday, January 19 2006 15:26 Hrs (IST) - World Time -

New Delhi: Government today (Jan 19, 2006) gave its go-ahead for signing of convention with Saudi Arabia for avoidance of double taxation and prevention of tax evasion.

The Cabinet, which met under the chairmanship of Prime Mnister Manmohan Singh, approved the signing of convention with Saudi Arabia for avoidance of double taxation and a Memorandum of Understanding to combat crime, Information and Broadcasting Minister Priyranjan Dasmunsi told reporters here.

The convention, after coming into force, will stimulate the flow of investment, technology and services from India to Saudi Arabia and vice versa, he said.

It would also provide tax stability to the residents of India and Saudi Arabia while facilitating mutual economic cooperation, the Minister added.

Giving details of the MoU, Dasmunsi said it was aimed at cooperating in combating organised crime and crimes perpetrated by individuals, as well as crime in all its forms, in particular international terrorism, illicit trafficking in narcotic drugs and psychotropic substances, illegal trafficking in historical artifacts.

The Cabinet also approved agreement with Croatia for the Avoidance of the Double Taxation and prevention of fiscal evasion with respect to taxes on income.

The agreement will stimulate the flow of capital, technology and personnel from India to Croatia and vice-versa, the Minster said, adding that it will also reduce obstacles for providing mutual cooperation.

India has so far signed double taxation avoidance treaties with 69 other countries.