Investor FAQ

Yes, in most sectors. India permits 100% foreign direct investment under the automatic route — no prior government approval — across IT and software, most manufacturing, e-commerce marketplaces, renewable energy, infrastructure and many services. A handful of sectors carry caps (for example multi-brand retail, banking, defence, media) and a short list is prohibited outright. Confirming your sector's exact position is the first thing we do, at no charge.

If you plan to invoice Indian customers, hire a team, or manufacture, a wholly owned subsidiary (private limited company) is the default: limited liability, full ownership, domestic tax rates and easy scaling. A branch office suits narrow contract-execution cases but is taxed at the higher foreign-company rate (~35%). An LLP can work for services businesses wanting lighter compliance, though it is harder to fund with equity. A liaison office is right if you only want a market-research presence with no revenue. See our market entry guide for the full comparison.

Yes. Under Press Note 3, any investment where the investor or its ultimate beneficial owner is from a country sharing a land border with India — China, Pakistan, Bangladesh, Nepal, Bhutan, Myanmar or Afghanistan — can require prior government approval whatever the sector. Since Press Note 2 of March 2026, non-controlling beneficial ownership of up to 10% from these countries proceeds under the automatic route subject to reporting; larger or controlling stakes still need prior approval, and investment funds with mixed investor bases should map their ownership chain early.

No. India abolished minimum paid-up capital requirements in 2015. You can incorporate with a nominal amount, though in practice we recommend capitalising what your first 12–18 months of operations genuinely need — it simplifies banking and avoids repeated FEMA reporting for top-ups.

In most sectors, no — you can own the company entirely. A joint venture becomes relevant either where a sector cap forces it or where a local partner brings distribution, licences or relationships you cannot build quickly. If you do take a partner, the shareholders' agreement (governance, deadlock, exit) deserves more attention than the business plan.

For automatic-route sectors, plan on 15–25 business days from documents-ready to a functioning company: incorporation itself often completes within two weeks, with the bank account, capital remittance and GST registration filling the balance. Approval-route sectors add roughly 12 weeks for government clearance under the current DPIIT procedure. The most common delay is incorrectly notarised or apostilled parent-company documents — which is why we check those first.

No. Incorporation is fully digital: you sign with digital signature certificates, and your home-country documents are notarised and apostilled locally. Board meetings can be held by video. Many of our clients first visit India months after their company is already trading.

The Companies Act requires every Indian company to have at least one director who stays in India 182 days or more in the financial year (pro-rata in the year of incorporation) — the law wants someone locally answerable. Foreign parents typically appoint a trusted local executive, or engage a professional resident director until their country manager is hired. We help you meet this requirement properly, with clear scope and safeguards on both sides.

Once incorporated, your company opens a current account with an Indian or international bank operating in India (most global banks are present). The account receives your share capital from the parent — generating the FIRC that supports the mandatory FC-GPR filing — and can hold and transact in foreign currency through EEFC accounts where useful. We manage the KYC process, which is document-heavy but predictable.

Government fees, stamp duty and professional charges for a standard subsidiary typically total ₹60,000–₹2,50,000 (approximately US$600–2,700 at current rates), varying with authorised capital, state and licences needed. We quote one all-inclusive fixed fee before starting, covering incorporation, tax registrations, the FC-GPR filing and post-incorporation formalities — so the number you approve is the number you pay.

You need a registered office address from day one, but it need not be commercial premises you lease — a compliant registered-office service works while you decide. When you do take space, options range from co-working seats to SEZ and GIFT City facilities. We arrange the registered office and advise on the real-estate step when you are ready.

Three main layers. Corporate income tax: most foreign-owned subsidiaries elect the 22% concessional regime (~25.17% effective). GST on sales: since the 2025 reform, mainly 5% or 18%, with most services at 18% — largely a pass-through since you credit GST paid on inputs. Withholding taxes on certain payments such as salaries, rent, professional fees and cross-border remittances. Our taxation guide covers all three.

Yes. India's rupee is fully convertible on the current account: dividends, royalties, technical fees and service payments flow out through normal banking channels once taxes are settled. Dividends are taxed in the shareholder's hands, with rates usually reduced by the tax treaty between India and your home country. Capital can be repatriated on exit through share sale or buyback, subject to pricing guidelines. Structured properly at entry, repatriation is routine.

Generally no. India has double taxation avoidance agreements with more than 90 countries, which allocate taxing rights and provide credits so the same income is not taxed twice. Where the parent sits determines which treaty applies, which is why holding-structure design is part of our entry work rather than an afterthought.

If your Indian company transacts with group companies abroad — management fees, royalties, intercompany sales, cost recharges — those transactions must be priced at arm's length and documented annually, with an accountant's report filed with the tax return. It applies to virtually every foreign-owned subsidiary. Set up correctly, it is routine; ignored, it is India's most common tax dispute.

Yes. Production-linked incentive (PLI) schemes pay manufacturers a percentage of incremental sales in sectors like electronics, pharma, autos and solar. GIFT City entities enjoy specific tax concessions for financial services and export businesses; the SEZ income-tax holiday closed to new units in 2020, though customs benefits remain. States compete with capital subsidies, power tariff concessions and land support. Exports are zero-rated under GST. Eligibility is fact-specific and policies evolve — we validate current schemes against your plan.

Once your entity exists, hiring is straightforward: offer letters and employment contracts under Indian law, registration for provident fund and state insurance where thresholds are met, and monthly payroll with tax withholding and statutory remittances. India's talent pool is deep and English-speaking. Most of our international clients outsource the entire payroll cycle to us — payslips, filings and year-end certificates — until their local finance team is ready.

The recurring set: four board meetings a year, an AGM, statutory audit (mandatory for every company), annual ROC filings, monthly or quarterly GST returns, quarterly TDS returns, advance tax instalments, the annual corporate tax return, the FLA return to RBI each July, and payroll filings. It sounds heavier than it is when consolidated — our clients see it as one calendar with one owner. Details in the compliance guide.

India is a common-law jurisdiction with enforceable contracts, full trademark, patent, copyright and design regimes, and international arbitration widely used for cross-border agreements (Singapore is a popular seat). Court timelines can be long, so well-drafted contracts with arbitration clauses are standard practice. Register your trademarks early — India follows first-to-file.

Business visas cover meetings and exploration; employment visas are required for foreign nationals taking roles in the Indian entity, generally with a minimum salary threshold, and are typically issued for a year and renewable in-country. Registration formalities apply for longer stays. We coordinate the process alongside your entity setup so people and paperwork land together.

A fair question to ask before entering. Share sales to another investor are the cleanest route; buybacks and capital reductions are available subject to pricing rules; voluntary liquidation of a solvent company typically takes about a year. Planning the exit path at entry — in the charter documents and any shareholder agreements — is inexpensive and makes every later option easier. We build it in as standard.