Foreign Direct Investment in India

The capital investment in India from a foreigner or a foreign entity is restricted and is governed by the provisions of the Foreign Exchange Management Act (FEMA). Every year central government through RBI comes up with a consolidated FDI policy, also known as Master Circular on FDI

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Foreign Direct Investment in India

The inflow of foreign exchange to be invested as capital in the business is known as foreign direct investment. The FDI is not permissible in proprietorship and partnership business, However recently government have notified rules whereby the FDI is allowed in LLP under the approval route. The foreign investment in companies is the easiest from a compliance point of view. Most of the sectors are open for 100% FDI where no prior approval is necessary, however, post the investment made in India a formal reporting is needed. We are known for quality advisory on FDI matters in India, and with proper documentation in place, a company with FDI can be incorporated within a week time. We are presenting key aspects of FDI for easy understanding, for any query kindly reach us

Options and Methods to Make Foreign Direct Investment in India

Subsidiary Company
Subsidiary Company
A foreign company can start full-fledged operation in India by registering a subsidiary company in India. Such a company is treated at par with Indian Companies for all legal purposes.
Company Owned by Foreigner
Company Owned by Foreigner
Two or more person of foreign origin can start a business in India by forming a company in India. The investment in company must be through banking channel and in foreign exchange
FDI in LLP
FDI in LLP
Though FDI in companies are mostly allowed under automatic route, however for LLP, FDI can be made only through approval route, nowadays FDI approval is accorded by concerned ministry
Branch Office in India
Branch Office in India
A foreign company can operate in India as a branch office, wherein the entity shall be treated as a foreign company, and thus higher tax rates shall apply @ 40% instead of 30% on indian com.
Liasion Office
Liasion Office
For a limited purpose of promoting awareness of the products or services of foreign parent company or function as a channel of communication, a Liasion Office can be opened.
Project Office
Project Office
When a project is awarded to a foreign co, a project office of such foreign company can be established in India. RBI has granted general permission to setup project offices.
Prohibited Sectors for FDI

Lottery Business including Government /private lottery, online lotteries, etc.

Gambling and Betting including casinos etc.

Chit funds/ Nidhi company

Trading in Transferable Development Rights (TDRs)

Real Estate Business or Construction of Farm Houses

Manufacturing of Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes

Sectors not open to private sector investment e.g. Atomic Energy and Railway Transport (other than MRTS).

Foreign Direct Investment in India

ECONOMY OVERVIEW

Region:

South Asia

Income category:

Lower middle income

Population:

1,311,050,527

GNI per capita (US$):

1,590

Young working population