Monday, 19 Dec 2011
Even as it proposes a Free Trade Agreement with the Indian government, Australia is keen to lay out a red carpet for Indian companies looking to mine coal or iron ore in Australia. However, new taxes on mining could also mean that Indian companies will have to buy assets in Australia as well.
GVK recently paid a little over USD 1 billion for 3 coal mines in Australia and it is not alone. Indian power and infra companies are making a beeline for Australia. But two new taxes, carbon and mining tax could act as a spoiler. The Australian government however is at pains to explain that the incidence of these two taxes will be minimal.
Mr Bill Shorten minister for financial services of Australia said "It’s better to tax profits rather than an umbrella royalty. Australia can definitely offer large natural resources to Indian companies looking for mining opportunities."
He said that "We have long term pension funds which are really keen to be part of the Indian growth story and infrastructure is an attractive investment area.”
Meanwhile, the Australian government is also looking to invest in India. Australian pension funds, some with assets over USD 15 billion are keen to pump in long term funds in the infrastructure sector.
Even as Australia and India increase their engagement, the Australian government is ultimately looking at a FTA with India to boost economic co-operation between the two countries.
(Sourced from profit.ndtv.com)
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