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How foreign investors to set up business in India

How foreign investors to set up business in India

Tuesday July 14, 2020,

5 min Read

India is one of the world's largest consumer markets and with recent government policies for ease of doing business in India like startup India initiative and make in India, the government has eased compliance burdens and legal requirements to set up businesses in India.

There are two ways in which a foreign investor can set up business in India

First is by registering an entity like a private limited company, limited company, LLP, or proprietary/ partnership firms.

Out of all the above, the easiest and cheapest way to set up business in India is by incorporating a private limited company.

The foreign direct investment which ranges up to 100% in a private limited company or a limited company happen under the automatic route and in such case, no special permission is required from the Central Government in India.

100% FDI in LLP is also allowed now, but there are no shareholders in LLP but partners hence making it ideal for service or professional firms.

Other forms of entities require RBI approval, thus making it not much ideal for foreign investors.

Secondly, one can opt to register a branch office, project office, or liaison office which necessarily requires RBI and/or Government approval.

Therefore the cost and the time which is required for the registration of a branch office, project office, or liaison office is certainly higher than the time and cost attached to the incorporation of a private limited company.

Hence entrepreneurs can focus on what they are best at, that's business.

How Online Filings Help in Setting up a Business in India.

Online filings make it really easy for foreign investors to set up business in India by reducing the need for the physical presence of the investors in all the required platforms.

We at online filings provide consultancy right from the market entry strategy to the registration of the suitable legal entity and all other licenses or registration for starting the business in India, further by taking care of the annual legal compliances such as tax filings, roc filings, and preparation of financial accounts.

We make it easier to do business in India by reducing the burden of legal compliances and day to day financial management services.

Hence entrepreneurs can focus on what they are best at, that's business.

All other regulatory affairs are dealt with by us.

How FDI has improved, and it helped foreign investors to invest in India

The 2020-21 Budget presented by Finance Minister Nirmala Sitharaman will improve the ease of doing business in India and attract more foreign direct investment, US industry leaders have said.

Presenting her second budget in Parliament on 1 Feb 2020, honorable finance minister Nirmala Ji offered tax breaks to foreign investors and specifically those like sovereign wealth funds who are willing to place a long-term bet on the economy.

Despite a slowdown in growth, the global outlook for investment in India remains strong.

“On ease of doing business, measures such as simplified GST returns, no audit requirement for MSMEs with up to Rs 5 Cr turnover, instant issuance of PAN by furnishing Aadhaar, pre-filing of tax returns, faceless appeals and assessments will further enhance India's image from an ease of doing business perspective.

Welcoming the budget, the US-India Business Council (USIBC) said that the abolition of the dividend distribution tax (DDT) removes a major disincentive to foreign companies seeking to set up operations in India.

The finance minister has taken solid steps to increase foreign investment and boost Make in India, it said.

India's Economic Growth Until 2022

It's better to say that Indian businesses are emerging. We are bringing innovation and creativity in the market. India is preparing to enter a new phase of innovation.

The global recession will hit the Indian economy too. But we will get back on track soon by 2022 if we follow the GO LOCAL mantra of our PM. It is time to think FOR INDIA, BY INDIA. One should BUY MADE IN INDIA. By empowering India, we empower our economy and create a sustainable growth factor for all the Indian.

Investment Point of View: India Is Still Performing Better In Environmental Sector

A total of $126 billion is needed over the next 20 years in order to upgrade India's water


Another $3.4 billion is needed to improve the municipal solid waste management as well. In order to meet these demands, the government of India has allocated $1 trillion for plans in creating 100 smart cities and restore 500 other cities and towns over the next five years.

This plan includes:

  • Clean water supply initiatives
  • Effective ways of managing sanitation and waste
  • Efficient mobility and public transport

This is where the opportunities present themselves for foreign investors.

India is now the seat of pollution but despite this drawback, India remains to present the world with countless opportunities.

In as much as it is destroying itself, it is also trying it's very best to redeem itself environmentally and economically. With the proper market research, industries can find ways on how to fix these problems and use these options as a foundation for business.

Market research and reports indicate that the pollution control industry is currently experiencing stagnant growth but experts believe that this is only temporary. It is even estimated that the total market size in India's

The pollution control industry will be around $8.5 Billion in the coming years.

The pollution control industry is mainly composed of manufacturers in pollution control equipment. Pollution control equipment manufacturers are concerned with the following sectors:

1. Air pollution control

2. Energy efficiency and renewable energy

3. Municipal solid waste management

4. Water and wastewater management

These sectors are quite promising due to the growth in these industries projected within the next 3 - 5 years.