FDI and Entering Business in India
A foreign company or a non-resident planning to set up business operations in India can do so in the following manner:
- As a foreign company through a Liaison Office/ Representative Office, Project Office or a Branch Office.
- As an Indian company through a Joint Venture or a Wholly Owned Subsidiary.
The process of Setting up and operation of Business In India is under the strict scanner of The Indian Income Tax Authorities, The Reserve Bank Of India, Foreign Exchange Management Act , Foreign Exchange Regulations Act. Making it an structured complex process.
The process can be summarized as follows :
- Investments In India are subject to either Government Approval Route or Automatic Approval route, as per the guidelines of Foreign Investment Promotion Board (FIPB).
- Investments are then subject to various Sectoral caps in equity, as per the prescribed guidelines of FIPB for different sectors of Industry.
- Various approvals and compliances of Government Of India, RBI, FIPB are required at various stages right from the inception of Business.
- Banking regulatory compliances are also required right from the time money (FDI) enters India.