India trying to pacify foreign investors over tax row

Mumbai

INDIA's Finance Ministry could have sidestepped a damaging multi-billion dollar tax row with foreign investors if it had acted on regular warning letters that officials had been sending since as long ago as September.

The warnings went unheeded, according to senior sources in the tax department and finance ministry, until the dispute with overseas investors over the imposition of the minimum alternate tax (MAT), which had not previously been applied to them, hammered the country's stock and bond markets and dented the business-friendly image of Prime Minister Narendra Modi.