India and Cyprus have a longstanding friendship which is being reinforced by new efforts to increase mutual investment activities and promote deeper business cooperation in multiple economic sectors.
How would you describe the current bilateral relations between Cyprus and India?
Relations between Cyprus and India go back to the founding of the two countries decades ago, as well as in the collaboration by their respective leaders President Makarios and Prime Minister Jawaharlal Nehru in the establishment of the Non-Aligned Movement. Naturally, with our entry into the European Union in 2004 we had to move on, but the genuine sentiments of national ties remain strong to this day. Our long-standing relationship both in bilateral and multilateral spheres has been consistently strengthened over the decades. It is a relationship which is premised on deep friendship, mutual respect and close cooperation. In recent years this bond has been strengthened with high level delegations from India, including the former President of India, the current External Affairs Minister, visiting Cyprus. In addition to the High Commission in New Delhi, Cyprus maintains an Honorary Consulate in Kolkata, a city which boasts high artistic venues and creativity, and a new Honorary Consulate is under way in Mumbai, the financial centre of the country.
Cyprus has focused on developing stronger economic links and trade relations with India over the years, what kind of joint projects have the two countries participated in and what new prospects are there to increase cooperation?
Cyprus and India cooperate in the areas of economy, commercial activities and investment within the framework of various Agreements and Memoranda of Understanding signed between the two countries over the years. The two countries are poised to consistently work together towards further strengthening cooperation in areas such as information technology, science, financial services, shipping, pharmaceuticals, tourism and renewable energy – particularly solar energy. In this regard, Cyprus signed the Framework Agreement to join the International Solar Alliance (ISA) in December 2022, and became the 92nd Member State of the Alliance. During the 6th Congress of the ISA, held in New Delhi, Cyprus became a member of the Credentials Committee to evaluate the accession of new members.
India recently also accorded a special status to Cyprus enabling Category 1 of Foreign Portfolio Investors (FPIs) to invest in Indian capital markets. A number of Indian entities have already set up establishments in Cyprus or are in a strategic alliance. From time to time, Invest Cyprus engages in promoting growth of business between the two countries. Cyprus offers very high professional quality of financial segment solutions.
Regarding the IMEC trade corridor (Indian-Middle East-European Economic Corridor), as announced during the recent G20 Summit in New Delhi, with shipping and rail infrastructure from India to Europe, via the UAE, Saudi Arabia, Israel and ending up in Greece, Italy and France, Cyprus finds itself naturally in the way of the trade route and can certainly contribute as an alternative location to berth or refuel ships. Cyprus also participated in the 3rd Global Maritime Conference of Mumbai, one of the main shipping gatherings of key players of the industry around the world.
Cyprus is a strong regional hub and EU base for international business and offers many advantages for companies engaged in cross-border activities, what advantages does Cyprus offer specifically to Indian business?
As India is an important trade and investment partner for the EU, and holds significant additional potential in this regard, the resumption of the much-awaited negotiations between the EU and India to establish a Free Trade Agreement (FTA) in June 2022, after a gap of nine years, was truly a major positive development. It is our true hope that during the next round of negotiations, the two sides would make further progress in the course of concluding the negotiations. Additionally, with its low corporate tax rate, high quality of skilled professionals, expertise of European laws, also similar base of legal systems (based on Commonwealth laws), Cyprus is considered a gateway to Europe and appears attractive to foreign investors – offering additional tax benefits which aim at bringing Indian investors to Europe at a more attractive cost than many other European locations.
What sectors or niche segments in Cyprus do you think have untapped potential in terms of attracting more Indian investment and cooperation?
In terms of investment, Cyprus remains among the 10 largest sources of FDI in India, and thanks to India’s decision to reclassify Cyprus regulated funds and fund managers as Category 1 FPIs led to an increase of over 100% in the FPIs and is a sector which will continue to grow. Moreover, in December 2021, Invest India and Invest Cyprus signed an MoU, with the aim of strengthening bilateral efforts for increasing mutual investment activities, and for promoting business cooperation between the companies from both sides.
The Trade Office of the High Commission in New Delhi facilitates the opportunities for commercial exchanges between the two countries and promotes bilateral trade. This December, Cypriot companies will participate in the well-known SIAL international food fair In India. I believe that with the restart of the Mumbai Honorary Consulate, we will be able to accelerate the business relationships between both countries. India and Cyprus have a large percentage of SMEs, and this is an area of cooperation for direct access, from India into Cyprus and into Europe.
What new prospects do you see to further strengthen relations with India, and how do you see the relationship of the two nations developing in the future?
There is already a Bilateral Cultural Cooperation Agreement between the two countries since 1980. Within the next months, the new Executive Programme covering the period 2024-2027 will be signed. I have already met with the Director General of the Indian Council of Cultural Relations and there is the common willingness to further tighten and strengthen the bilateral relations in the cultural field. We are happy to announce that in November, the Cypriot dance group SELAS visited India for performances in various cities, with the support of the Deputy Ministry of Culture. Several Art exhibitions and other cultural activities are also planned within 2024.
