The Convention On Mutual Administrative Assistance in Tax Matters is a deal which promotes international administrative co-operation in the assessment and collection of taxes, while respecting the rights of taxpayers, said the Organisation of Economic Co-operation and Development in a statement.

The agreement is the OECD's latest step towards combating tax avoidance and evasion. With taxpayers increasingly working and living globally, tax authorities are moving from bilateral to multilateral cooperation and from exchange of information on request to other forms of co-operation.

By signing the convention, the OECD hopes that India and the other 31 signatories will encourage more countries to join, sending a strong signal that countries are acting together to ensure that individuals and enterprises pay the right amount of tax, at the right time and in the right place.

“India has moved very quickly since its commitment to the convention at the November G20 ceremony in Cannes and I expect it will be the first non-OECD G20 country for which the updated Convention is in force”, said Jeffrey Owens, director of the OECD Centre for tax policy and administration. 

Signatories to the amended convention are: Argentina, Australia, Belgium, Brazil, Canada, Denmark, Finland, France, Georgia, Germany, Iceland, India, Indonesia, Ireland, Italy, Japan, Korea, Mexico, Moldova, Netherlands, Norway, Poland, Portugal, Russia, Slovenia, South Africa, Spain, Sweden, Turkey, Ukraine, the United Kingdom, and the United States.

It is the latest sign of India stepping up pressure on tax evaders. A report published by the OECD after the G20 summit in November, showed that India more than doubled its requests to obtain classified funds information from tax havens and other countries in the last two years.

During the last two years India has negotiated 19 new double taxation avoidance agreements and 17 new tax information exchange agreements. It recently teamed up with the US' Internal Revenue Service to train an India-based team on the intricacies of unearthing hidden funds. 

India became a full-member of global economic body the Financial Action Task Force last year and strengthened its Financial Intelligence Unit to detect suspicious transactions in economic channels, which will also help its relationships with other global governments.

"A very significant proportion of investment flowing into India, Russia and China is routed through low tax jurisdictions," the report said, adding that India is "actively participating" in the global efforts to enhance cooperation between tax authorities and law enforcement agencies to filter out financial crimes and illicit flows.

In November the Paris-based think-tank said that a tougher crackdown on tax evasion by the world's richest individuals could raise as much as $100 billion in tax revenue for cash-strapped governments. A survey of 20 countries conducted by the OECD showed that measures to deter tax evasion have paid off - raising over $19 billion within the past two years.