India and Cyprus share a historic friendship that is based on a common set of values and a shared history of colonialism. Over the years, more than 15 agreements and memorandums of understanding have been signed between the two countries, for cooperation in the fields of commerce, science and technology, culture, information exchange, health, and medicine. Additionally, Cyprus has built a productive relationship with the High Commission of India in Cyprus over the years. The two countries’ good relationship, combined with Cyprus’s multitude of investment opportunities, favourable climate, and high quality of living have made the island popular among Indian nationals seeking investment opportunities abroad.
Xenia Neophytou, CX Financia’s Managing Director and Board Member of the Cyprus India Business Association answers some questions about the strong bond the two countries have developed and the many ways in which Indian nationals can invest in Cyprus.
How did the relationship between India and Cyprus develop?
Diplomatic ties between the two countries came into effect two years after Cyprus became independent from British colonial rule, in 1962, with the signing of a bilateral legal framework for cooperation. Since then, the two countries have supported each other in various economic, social, and industrial issues, and have established a number of agreements, including the Cyprus-India Joint Committee on Economic, Scientific, Technical and Industrial Cooperation in 1989, the Cyprus-India agreement on tourism cooperation, signed in 1996, and the Agreement on Abolition of Visa Requirement for Holders of Diplomatic, Official or Service Passport, which came into effect on 1 May 2008, among many others.
What is the current state of relations between the two countries?
Bilateral trade between India and Cyprus amounts to 70 to 80 million dollars per year, and the Chamber of Commerce and Industry, in collaboration with the Cyprus India Business Association, aims at intensifying its efforts for increased commercial and economic cooperation between Cyprus and India. The recently revised bilateral double taxation agreement, which was signed in November 2016, is expected to offer predictability, transparency and a further impetus to investments between India and Cyprus, and there is significant interested in the fields of agriculture, tourism, education, financial services, energy, IT, and manufacturing.
What would be the main advantages of an Indian business looking to invest in Cyprus?
The fact that Cyprus is an EU member country, with access to the common European market, offers a multitude of opportunities for Indian businesses. Furthermore, Indian companies can use Cyprus as a regional hub from where they can conduct operations in the nearby Middle East, Gulf, and Balkan countries, capitalizing on the excellent political and economic relations Cyprus enjoys with these regions. Additionally, Cyprus boasts a highly skilled workforce, advanced infrastructure, and high quality of life, all of which would be greatly beneficial to Indian businesses or individuals seeking to invest in or relocate to Cyprus. Finally, Cyprus offers a number of tax incentives, including a corporate tax rate of 12.5%, dividend participation exemption, and no taxation of capital gains, among others.
What are some of the areas of investment in which Indian businesses could possibly invest?
There are a number of growth sectors in Cyprus that have piqued the interest of Indian investors. Among the more traditional avenues is the shipping industry. Cyprus boasts one of the largest maritime clusters worldwide and advanced maritime infrastructure. Real estate is also a popular sector for investment. The booming construction sector includes landmark residential and commercial projects and comes with the added incentive of the Cyprus Investment Programme, which allows investors to apply for Cyprus citizenship. The energy sector is offering new opportunities in renewable energy utilization, thanks to the island’s recent world-class natural gas discoveries and contracts with energy giants ExxonMobil, Shell, Total, Noble Energy, and more. This has made Cyprus a rising fuel hub and an ideal regional base for serving the Eastern Mediterranean region. Alternatively, investors can look into the flexible structures of UCITS and AIFs, which have low set-up and operation costs, and high-quality business support services. At the same time, Cyprus is fast becoming a hub for innovation, entrepreneurship and start-ups, with a strong ICT and innovation ecosystem and start-up visa scheme for third-country nationals that is particularly attractive. Finally, Cyprus has much to offer India’s highly successful Bollywood film industry, thanks to its beautiful and varied landscape and ideal climate that make it a perfect shooting location.
How can CX Financia help Indian nationals seeking to invest in or relocate to Cyprus?
Our team of experienced and knowledgeable professionals offer a range of first-class corporate services to both organizations and individuals. We help clients structure and establish their business in Cyprus, offering advice and guidance on all aspects, from acquiring financial brokerage services licenses to hiring office staff and arranging for immigrant visas. Our multicultural and multilingual team has vast experience in a number of tax solutions and can help solve complex problems at both a personal and corporate level. We also offer a number of other services, including bank account opening, incorporation of businesses in Cyprus or abroad, incorporation and licensing of funds, investment firms, and other financial entities, internal and external accounting services, immigration and permanent residency services and can also advise on the applications for the Cyprus Investment Program.
Contact us today to find out how we can help get your business started in Cyprus.