India and Switzerland have signed a MoU on financial dialogue that would pave the way for greater cooperation between tax authorities of the two countries, a move that would allow Indian money stashed in Swiss banks to be unearthed.
The agreement, signed by India's ambassador to Switzerland Chitra Narayanan and Swiss Department of Finance secretary Michael Ambuhl, follows close on the heels of the signing of an amending protocol to the Double Taxation Avoidance Agreement.
The MoU was signed on Monday in the presence of president Pratibha Patil, who was on a state visit to Switzerland, and her Swiss counterpart Micheline Calmi-Rey. The MoU deals with the creation of a useful forum for exchange of views on financial and macro-economic issues.
According to official sources, the MoU would facilitate dialogue between the tax authorities of the two countries.
"We noted that the amending protocol to the Double Taxation Avoidance Agreement would provide a framework for exchange of tax related information of importance to either side, when it enters into force," Patil said in a statement.
India is taking several measures to unearth illegal funds stashed across various tax haven nations and foreign shores.
According to the Swiss government's statement, the financial dialogue under the MoU would allow Swiss and Indian authorities to establish regular and privileged contacts in the financial sector "to identify common interests and to work together to achieve them".
"With the signing of the memorandum of understanding, the federal department of finance and India's ministry of finance have laid the foundations for fostering financial dialogue between the two countries", the Swiss statement said.