Doing Business in India

Foreign Direct Investment (FDI) inflows during the year 2009-10 have been steady in spite of the decline in global capital flows. India received FDI equity inflows of US$ 20.9 billion during April-December, 2009 compared to US$ 21.1 billion during the same period last year.

India's economic policies are designed to attract capital inflows into India on a sustained basis.

Policy initiatives adopted in recent years include, broadly two aspects:

A. Financial aspect, regulated by the Foreign Direct Investments (FDI) policy. It specifies whether foreign company can setup subsidiary / joint venture, with or without approval of Government; with or without Indian partner; etc. Currently,

• Up to100% foreign equity permitted in many industries. It is not necessary for foreign investors to have a local partner.
• Automatic approval for majority foreign equity participation up to 74% in certain key areas, and up to 51% or 50% in several others.
• Repatriation of profits and capital investment. Indian companies are permitted to make payment by way of lump sum and royalty for transfer of technology by foreign entity and where there is no transfer of technology, for use of trade marks and brand names. Royalty payment can be for any number of years.

 

To know about sector specific limits of investment and policy, as per the Notified Foreign Direct Investment (FDI) Scheme, click here.

Financial aspect can be taken care by planning appropriate entry strategy / investment route in India. To know more, click here.

 

B. Industrial Policy - it specifies whether any license required to setup manufacturing base/commence operations in India; location of such base and clearance under pollution laws.

We advise on regulatory requirements. We provide consultancy on applicable laws, registrations / permissions required and structuring operations / transactions. To know more about our services to foreign entities, click here. For company formation in India click here.