In a landmark achievement, India signed a record-breaking 174 Advance Pricing Agreements (APAs) with taxpayers in the 2024-25 financial year, which concluded on March 31. The agreements, aimed at ensuring tax certainty in transfer pricing, include a combination of Unilateral APAs (UAPAs), Bilateral APAs (BAPAs), and, for the first time, a Multilateral APA (MAPA). This marks the highest number of APAs signed in a single financial year since the programme’s inception, reinforcing India's commitment to improving the ease of doing business for multinational enterprises.

What APAs Achieve
APAs are designed to provide businesses with tax certainty by establishing pricing methods and determining arm’s length prices for international transactions in advance for up to five years. Bilateral APAs offer the additional advantage of shielding companies from potential or actual double taxation, making them highly beneficial for multinational corporations operating across different tax jurisdictions.

CBDT's Statement on the Record-Breaking Year
The Central Board of Direct Taxes (CBDT), which oversees tax policy and administration in India, confirmed the milestone in an official statement. The record 174 agreements signed this fiscal year represent a significant leap in India’s APA programme, which has steadily grown in importance since its introduction.

What lies ahead for India
The record number of APAs signed in 2024-25 highlights India's proactive approach in fostering a stable and predictable tax environment for businesses. By facilitating tax certainty and reducing litigation risks, the APA programme continues to enhance India’s attractiveness as a global investment destination.