Guide to Establishing a Business in India for Foreign Investors

India is one of the fastest-growing economies in the world, offering a powerful combination of a young, skilled workforce and a consumer base of over 1.4 billion people. This vibrant economic landscape continues to attract robust Foreign Direct Investment (FDI), with more global companies choosing India as a key destination for their operations every year.

While the opportunities are vast, foreign companies must navigate a defined regulatory path to establish themselves in India. This includes compliance with:

• The Companies Act, 2013
• The Companies (Registration of Foreign Companies) Rules, 2014
• Reserve Bank of India (RBI) guidelines
• Foreign Exchange Management Act (FEMA)

Our team can help you every step of the way — from strategy to setup — ensuring your entry into the Indian market is seamless and fully compliant.

Business Entity Setup & Registration

Ways Foreign Companies Can Register in India

India offers multiple entry routes for foreign businesses looking to establish a presence in the country. Depending on the business model and objectives, foreign nationals or companies can choose from various structures:

1. Private Limited Company (Fastest Route)

Setting up a Private Limited Company is the quickest and most preferred method for foreign nationals. FDI up to 100% is allowed under the automatic route.

• Wholly-Owned Subsidiary: 100% foreign ownership is allowed.
• Joint Venture: Partnership with a local Indian business, with formal agreements aligned with legal standards.

2. Establishing a Foreign Office in India

• Liaison Office: For communication; cannot undertake commercial activity.
• Project Office: Suitable for specific projects; RBI approval may be needed.
• Branch Office: For wider operations; allowed for companies with a global track record.

Compliance & Regulatory Support

Regulatory Compliance for Foreign Companies in India

International investors must comply with company registration, labour laws, financial reporting, environmental norms, and foreign exchange rules.

Organisational Transparency & Corporate Governance

• Section 3: Company formation guidelines
• Section 23: Public offering disclosures
• Section 128: Maintenance of books of accounts
• Section 139: Appointment of auditors

Workforce Welfare Compliance

• Maternity Benefits Act (1961)
• Industrial Disputes Act (1947)
• Trade Union Act (1926)
• Workmen’s Compensation Act (1923)

Environmental Compliance

• Environment Protection Act (1986)
• Forest (Conservation) Act (1980)
• Indian Forest Act (1927)
• Hazardous Chemicals Rules (1989)

FDI & FEMA Regulatory Requirements

• FLA Return: Annual return for foreign investment
• Annual Performance Report (APR): For Overseas Direct Investments
• ECB Compliance: Monthly ECB-2 Returns for foreign borrowings

Post-Incorporation Reporting & Financial Filings

• E-Form FC-1: Within 30 days of incorporation
• E-Form FC-3: Financial statements and business locations within 6 months of financial year end

Board & Shareholder Meeting Support

• Conducting meetings as per secretarial standards
• Guidance to Board Members for effective governance

Corporate Restructuring

• Mergers, amalgamations, and demergers
• Capital restructuring to optimize finances

Winding Up & Dormant Status

• Support for winding up or closing entities
• Assistance in obtaining dormant status

Approvals & Legal Representation

• Shifting the registered office
• Condonation of delays
• Compounding of offences
• Cases related to oppression and mismanagement

Need Guidance?
Our experts help you choose the right entry strategy, manage legal compliance, and get your operations up and running smoothly in India.