Globalization has made the business world come closer. With FDI being liberalized in a unique way, India has opened doors for the world to come and do business in India. Companies from various countries come to India for business and seek registration for their representative companies or establishments here. We help by suggesting below models of doing business in India:

There can be two types of it based upon ownership namely

100% ownership

Fully owned subsidiaries (only in FDI permitted sectors as Per latest FDI policy)

Less than 100% ownership

Joint Ventures

Indian subsidiaries enjoy same rights as basically Indian Companies. There are certain norms to the activities of proposed companies as per FDI policy of the Government. Many activities are permitted to bring 100% foreign investments whereas on some activities Government has put restrictions where Government gives permission of 100% FDI and in a few activities 100% FDI is not permitted and even Government route can not be availed. In those cases, Joint Ventures are good channel of investment, where a certain percentage is held by Indian entities. In the Joint Venture Form of working, foreign company can get a good financial resource with some ready contacts and experienced partners, however a complete privacy has to be a bit parted with.

Assistance in getting FIPB Approvals

There are two entry routes of direct investment in India (FDI):

Automatic Route

Government Route (Approval Route)

Depending upon the sector where proposed investment is to be brought in, the above segregation is done. In many a sectors, Government restricts 100% FDI like defense, telecom etc. For such sectors, one has to get the approval of Foreign Investment Promotion Board (FIPB)- a division of Finance Ministry. We assist you in getting the FIPB approvals, taking care of all the formalities so you can rest assured of our services.

Channels other than FDI:

A foreign company can also come and do business in India without investing directly. RBI has permitted such companies to have establishments in India for some limited purposes. Such forms are:

Liaison office

Project Office

Branch Office

Different permissions and freedoms are attached with each such office. So one has to be careful while making choice of these forms of work. RBI permissions have to be sought for each such organization subject to renewals as specified from time to time. Also, the foreign companies have to register with Registrar of Companies (ROC) within 30 days of setting up a place of business in India, besides the said RBI Approval. Brief explanation is as below:

Liaison Office

This form is primarily for exploring the marketing opportunities and being a representative of head office, however in this form of organization, commercial activities are not permissible at all, whether directly or indirectly. Basically a Liaison Office works only as a communication link between head office and Indian entities. It can arrange for imports/exports in/from India but can not sell goods or services directly/indirectly. It can liaise about technical collaboration between Head office and prospective customers in India. A three year renewable permission is sanctioned by RBI for Liaison Office.

Project Office

There are many foreign companies which come to India only for specific project which may be awarded by Indian entities, e.g. road construction/ bridge construction or implantation of turnkey projects. These companies exit from India upon completion of that specific project. A general permission for the establishment of such project office is granted by RBI. There are certain specific conditions attached with such permission e.g. Project Offices cannot be engaged in any activity other than the activity belonging to that project. Upon wind up or completion of such Projects, a project office can remit surplus to the head office.

Branch Office

For the foreign companies which are willing to work full fledge but without investing directly have this option next to Wholly Owned Subsidiaries. Like subsidiaries, branch office can engage itself in trade, providing services etc. but not manufacturing which is a restriction by RBI. But such companies can outsource such manufacturing work to Indian entities. Branch Research work in which the parent company is engaged.

A branch office can not be engaged in manufacturing on its own but can subcontract these to an Indian manufacturer. Branch Offices established with the approval of RBI, may remit outside India profit of the branch, net of applicable Indian taxes and subject to RBI guidelines Permission for setting up branch offices is granted by the Reserve Bank of India (RBI).