Tag Archives: Company formations Procedure in India


Doing Business in India

Doing business in India offers enormous opportunities for Foreign companies. However, India is a large and complex market. It should not be seen as one market, but a series of interconnected regional markets where the legislative and investment climate may change from one state to another.

It is wiser to be in India now…

  • Fastest growing economy in the world
    (Current: 7% , by 2018: 7.8%)
  • World’s third largest economy
    (Would double in size to US$ 4–5 trillion in a decade)
  • Taxes on companies has been reduced to 25%
    (For companies with annual turnover less than 50 Crores)
  • World’s second-largest telecommunication market
    (1058.86 million subscribers)
  • By 2020, retail market is expected to grow to US$ 1.1 trillion
    (growing at a high rate of 20%-25% p.a.)
  • World’s sixth largest pharmaceutical market by 2020
  • By 2050, India will have added 300 million people
  • Working age group will be more than 64% by 2021
    (15-59 years)
  • Growing urban markets
    (23.1 Million people shifting from rural to urban areas in two decades)
  • Low labour costs
    (Total labour force of nearly 530 million)
  • Purchasing power parity, India’s economy is third largest in the world
    (Current-$ 8.7 trillion, by 2025-$ 20 trillion )

Foreign Direct Investment into India

Automatic Route

  • All sectors other than sectors which are specifically prohibited or under approval route
  • Should comply with sector based investment and other conditions (i.e. sectoral caps)

Approval Route

100% FDI through Government approval route

  • Extraction of titanium
  • Publishing of scientific & technical magazines/specialty journals/ facsimile
  • Edition of foreign newspapers
  • Satellites (establishment & operation)
  • Pharmaceuticals (Brownfield)

100% FDI: Government approval required beyond 49%

  • Telecom Services
  • Broadcasting Carriage Services
  • Single Brand product retail trading

100% FDI: Government approval required beyond 74%

  • Existing projects of Airport

49% FDI : No Government approval required

  • Infrastructure Company in the Securities Market
  • Insurance
  • Pension Sector
  • Power Exchanges
  • Defense
  • Air Transport Services (Scheduled): 100% for NRI

49% FDI through Government approval route

  •  Broadcasting Content Services (except Up-linking & Down-linking
    of Non-‘News & Current Affairs’ TV Channels)
  •  Private Security Agencies

FDI limits less than 100%

  •  Banking (Private Sector): 74% FDI is allowed. However,
    Government approval is required beyond 49%
  •  Banking (Public Sector): 20% FDI is allowed with Government
  •  Multi Brand product retail trading: 51% FDI is allowed with
    Government approval
  •  Print Media: 26% FDI is allowed with Government approval

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Developing Asia – Accelerate Growth Through Partnership

Growth Outlook
Developing Asia is facing considerable headwinds. Delayed recovery in major industrial economies and moderating prospects for the large economies of the People’s Republic of China and India weigh on region’s project growth forecasts. With the european economy meltdown, asian economy continues to grow.

Emerging : Asia leads global growth
A key factor behind Asia’s rising influence is the size of its economy. In 1990, the top five economies were not among Asia. However, now the top three economies are Japan, China and India.

Asia’s share in world GDP in real US$ purchasing power parity (PPP) was 23.2 percent. By 2014, this went up to 38.8 percent, much larger than the shares of the United States and the European Union.

In fact, Asia’s share is likely to go up in the coming years if current growth trends in key regional economies continue(forecasts by Oxford Economics put Asia’s share at nearly 45 percent by 2025 )

Growth Prospects in Asia
In 2017, 80% of regional economies are expected to post higher growth on the back of a recovery in external demand and further pickup in domestic demand.

Policies to stimulate potential growth

  • Partly offset the labor squeeze due to policy changes
  • Higher labor productivity
    Capital investment is crucial to catch up with the advanced economies.
    Reform can move current potential toward the frontier.
    Sound macroeconomic management is the foundation for growth.
  • Employment of the full range of policy responses


Slow going in a Tough Global Environment
In 2017, growth in the region will remain steady, as continued growth moderation in the PRC will be counterbalanced by solid growth in India.

Average inflation in the region will rise from 2.2% in 2015 to 2.5% in 2016 on strengthening domestic demand and further to 2.7% in 2017, following an expected recovery in global commodity prices.
Elements of Working Together

  • Build relationships first
  • Measure your success together
  • Leverage each other
  • Empower and partner beyond the communications function
  • Working beyond geographies
  • Client retention

Benefits of Working Together

  • Increasing speed to access knowledge
  • Reducing communication costs
  • Increasing speed to access external experts
  • Increasing satisfaction of clients, partners and external experts

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Procedure, method and list of documents for deploying a Project workplace in Asian countries.

RBI has liberalized and simplified the the procedures for institution of Project Offices in Asian countries. General permission has been granted to foreign entities for fitting Project Office(s) in Asian country. This permission is subject to the adherence to the provisions of Regulation four, and Regulation five of the FEMA Regulation No. twenty two that bury alia includes the subsequent conditions to be glad.

(i) It’s secured from associate Indian company a contract to execute a project in India; and

(ii) The project is funded by inward remittal from abroad; or

(iii) The project is funded by a bilateral or tripartite International Finance Agency; or

(iv) The project has been cleared by associate applicable authority; or

(v) An organization or entity in India or Asian countries grant the contract has been granted Term Loan by a Public institution or a bank in India for the project.

In case the on top of criteria don’t seem to be met, the foreign entity must approach the Federal Reserve Bank for approval.

The foreign company establishing a Project workplace in India or Asian countries is needed to furnish a report through the involved AD class – I bank branch to the involved Regional workplace of Federal Reserve Bank of India below whose jurisdiction the Project workplace is ready up at intervals sixty days of multinational of the new Project workplace with the subsequent details.

(i) Name and address of the Foreign Company,

(ii) Reference variety and date of letter grant the contract

(iii) Particulars of the authority grant the comes / contract,

(iv) The full quantity of contract,

(v) Address / e-mail address, / phone number / fax number of the Project workplace,

(vi) Tenure of Project workplace,

(vii) Temporary details of the Project undertaken,

(viii) Associate endeavor to the result that the Project workplace is eligible to avail of the final Permission below Regulation five AD branch with whom the account has been opened and also the foreign currency during which the account is opened


Project Offices will through their AD class – I banks open non-interest bearing Foreign Currency Account in Asian country subject to the following:

(i) The Project workplace has been established in Asian country, with the final / specific permission of Federal Reserve Bank, having the requisite approval from the involved Project enabling Authority.

(ii) The contract below that the project has been sanctioned, specifically provides for payment in foreign currency.

(iii) The permissible debits and credits within the account shall be as under:


Payment of project connected expenditure.


* Foreign currency receipts from the Project enabling Authority, and

* Remittances from parent / cluster company abroad or bilateral / tripartite international funding agency.

(iv) The responsibility of guaranteeing that solely the approved debits and credits area unit allowed within the Foreign Currency Account shall rest exclusively with the involved branch of the AD.

(v) The Foreign Currency account is also closed at the completion of the Project.


Foreign entities fitting Project workplace in Asian country ought to submit a report back to the Director General of Police (DGP) of the state involved wherever the project workplace has been established at intervals 5 operating days of the PO changing into practical. just in case of quite one workplace, the report ought to be stocked to every DGP of the involved state wherever the workplace has been established. The copy of the report in ought to even be filed with AD Bank by the fresh established Project workplace.

The Project workplace shall conjointly submit associate annual activity certificate to the AD branch.


Once Project workplace has been established, the PO is additionally needed to be registered with the Registrar of firms (“ROC”) in Asian country below the provisions of the businesses Act, 2013, at intervals a amount of thirty days from such date of multinational of the LO. The registration application is to be filed in e-form FC-1. constant is to be filed on-line with the mythical monster along side the requisite documents.

List of Documents needed for registration

- The certificate of incorporation/ registration. Latest Audited record of the human Foreign Company.

- Board Resolution of the Foreign Company on the corporate Letter head

- List of administrators and Secretary of the Foreign Company, punctually echt by any of its administrators.

- Power of professional (POA) authorize to represent the Foreign Company before the run and mythical monster.

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