Monday, 15 July 2013

Entry strategy for foreign investors

Entry strategy for foreign investors

OPERATIONS departure of India

The foreign companies have the option of following the plan to set up a business in India


Through 1956, by incorporating a company under the Companies Act, foreign companies, will be able to start a business in India

Or joint venture,

Wholly owned subsidiary

Foreign capital of India Such companies will be able to receive the stock cap in terms of the area of ​​activities under (FDI) policy foreign direct investment of up to 100 percent depending on the requirements of the investors.

Details of the FDI policy, you can get industrial policy and promotion Bureau, Government of India by category stock cap & procedure.

A joint venture with India PartnerForeign company, will be able to set its work in India by forging strategic alliances with partners in India.

The joint venture, may be accompanied by the following advantages for foreign investors.

Setup establishment distribution / marketing partner in India

Available financial resources of partners in India

Contacts that are established partners in India to help smooth the process of setting up operations

I can wholly owned subsidiary CompanyForeign company also set up wholly owned subsidiary in the field of foreign direct investment of 100% is permitted in the FDI policy.

Should be submitted to the (ROC) company registration and incorporation registration, the application.

Company was registered officially, if included as an Indian company, to be applied to Indian companies of other domestic, it will be subject to laws and regulations of India.

Foreign companies AS

Foreign companies can be set by their operations in India

Liaison Office / Representative Office

Project office


In the office like this, you can do the activities that are allowed any.

Companies need to register themselves with the Registrar of Companies (ROC) within 30 days to set up offices in India.

Liaison office / representative office OfficeLiaison acts as a communication channel of the principal place of business between the entity in India within the head office or business.

It is not possible to carry out commercial activities of any directly or indirectly, therefore, liaison office, can not I get paid for any of India.

Its role is limited in that it collects information about possible market opportunities and to provide information about the company and its products to customers in India in the future.

It also promotes the export / import to India from /, it is possible to promote the technology / financial cooperation between enterprises in India and parent company.

Approval to establish a representative office in India is granted by the Reserve Bank of India (RBI).

In India, planning project OfficeForeign companies will be able to set up temporary project / site offices in India to perform a specific project.

Currently, in order to establish a project office according to the conditions specified, RBI has granted permissions common to foreign companies.

Office such, can not be used either to undertake activities other than activities incidental in relation to the execution of the project and run it.

Project office, might be a surplus of general permission has been granted on the project completed the remittance outside India, by RBI.

Engaged in branch OfficeForeign company, are allowed to set up branches in India for the purposes of the following trading activities with manufacturing overseas.

Export / import of goods: (i)

And consultancy services professionals (ⅱ) rendering

to carry out research activities (ⅲ) the parent company is engaged.

Promotion of financial or technical collaboration between the overseas group companies and parent and (ⅳ) Indian companies.

Acts as a buy / sell agent of India and represent the parent company in India is a (v).

The development of the Indian software and information technology (VI) of rendering service.

rendering technical support to the products (ⅶ) parent company / group companies to supply.

(VIII) foreign airline / shipping company.

not be allowed to branch to perform manufacturing activities on its own, but to subcontract these to manufacturers in India are allowed.

Branch that was established with the approval of the net outside RBI month remittance subject to the guidelines permit interests of India branch to set up branches, appropriate Indian tax, of the RBI, granted the Reserve Bank of India by (RBI)

Isolated branch of such business activity / transaction not alone basis, "will not be allowed special economic zone of India, including the branch / subsidiary of the master station within, outside limit special economic zone in (SEZ) is
The branch to the stand-alone "


No approved, in order to establish a branch / unit economic zones to carry out manufacturing and service activities according to specified conditions (SEZ) in, there should not be necessary from RBI for a company.

Application to set up a liaison office / project office / branch, can be submitted to the available ( website of the RBI (form FNC 1.

Foreign direct investment (FDI) policy

Currently, with the exception of some areas that FDI is not permitted policy of notification sectoral and existing beyond the ceiling, including the service sector, FDI in the automatic route below, are allowed in all sectors.

It is necessary for FDI in the automatic route automatic RouteNo prior approval.

The only information to the RBI within 30days of issue of shares to non-residents or foreign remittance is required.

New form for reporting shares issued to foreign investors company of India, form FC-GPR (instead, FC-RBI previous) is prescribed RBI.

proposed the government ApprovalForeign investment is not covered under the 'automatic route' is considered to be for the government approved foreign investment promotion advisory committee (FIPB)

Foreign InvestorsNon Resident Indians

Applications for such cases, and usually FC / IL form Foreign Investment Promotion Board of the Government Ministry of Economic Affairs, Ministry of Finance, India northern block, is a New Delhi 110 001.Non Resident Indians in (FIPB)
It must be submitted in paper

There was a need to submit your proposal to the Secretariat for the Government of India for consideration industry support of industrial policy promotion (SIA) department store, the FIPB.

The taxation in India

In India, to promote the globalization of economic activities, it is moving towards the reform of the system and tax policy.

Corporate tax rate for foreign companies is 40%.

Net tax rate is much lower than on account of this exemption and deduction various available under the tax law.

Tax holidays, are available in the special economic zones set industry to enhance the competitiveness globally.

Projects of infrastructure sector, enjoy handling / holiday special tax.

Has been introduced in clock electronic filing of customs documents round 31.3.04 from the tax administration user-friendly

Facilitation of investment

The Government of India entrepreneurship support, secretariat for the (SIA) industry support of Promotion Bureau and industrial policy, offers a single window service for monitoring the implementation of projects and investment facilitation.

Secretariat for industrial assistance (SIA)

Promotion Bureau and industrial policy

Ministry of Commerce and Industry

Udobawan, New Delhi - 110 011


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