India plays fast and loose with its balance of payments The tax treaty between Mauritius and India allowed foreigner investors to avoid capital gains tax by routing investments into India through holding entities in Mauritius. However, India’s new “anti-avoidance” capital gains tax reforms stand to deter much of its FDI inflow. http://www.economist.com/node/21554523?fsrc=scn/fb/wl/ar/theailthatwagstheelephant