An Overview of Doing Business in India

by Poorvi Chothani, Esq. LawQuest

www.lawquestinternational.com
October 27, 2009

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Introduction to India
A growing country with 50% of the population under the age of 25 Highly skilled manpower Consistently increasing GDP Largest democracy and tenth largest economy in the world. India is the fourth largest economy in the world in terms of purchasing power parity. A federal system of Government

Foreign investment permitted under the automatic route in almost all sectors
FDI under the automatic route only subject to reporting requirements FDI prohibited in the following sectors:
Arms and ammunition, Atomic Energy, Coal and lignite, Rail Transport, Mining of metals like iron, manganese, chrome, gypsum, sulfur, gold, diamonds, copper, zinc

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

FDI Cap
Cap on Certain Sectors Luxury commodities for FDI is currently 51%. Govt. is proposing to take it up to 100%

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Business Structures
Foreign Investment is not permitted in partnership firms Foreign nationals cannot operate in India as sole proprietors of a business Available Options Liaison Office/Representative Office Project Office Branch Office Limited Liability Companies
Joint Ventures Wholly Owned Subsidiaries

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Incorporation of Limited Liability Company

Private Limited Company Public Limited Company Registrar of Companies Foreign Nationals as Shareholders and/or Directors

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Perfume Machinery
Indian Manufacturers
Satiks S.S. Perfume candle filter press machine Blenzor (India) - Indias No.1 designer and manufacturer

Indian Distributors of Foreign Machinery

G.Aromas Cosmic International Harleys Cosmetic & Chemical Work Sadik Kazura Aromatics

Options To Enter the Indian Market

Agent Wholly Owned Distributorship Independent Distributor Manufacture and Seller

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Luxury Watches
Single Brand Retailing - FDI up to 51 % Popular International Brands in India Christian Dior Seiko TAG Heuer Omega Movado Rolex IWC
Options To Enter the Indian Market - JV

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

The Travel Industry

International Travel Agencies in India
Kuoni (along with SOTC) Cox and Kings Thomas Cook Andrew Harper Inc.

Online Travel Agencies

Travelguru.com Yaatra.com Raj Travels Rangoli-India Insignia

Options To Enter the Indian Market

Agent Wholly Owned Distributorship Franchise

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

The Automobile Industry

Foreign Brands in India
Porsche Audi Honda Hyundai Rolls Royce BMW Mercedes Benz Land Rover

Indian manufactures
Tata Mahindra and Mahindra Maruti

Entry Options in Indian Market

Manufacturer (Wholly Owned or JV) Dealer Agency

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Solar and Other Alternative Energy

100 % FDI Permitted Local Companies
Majarishi Solar Technology Emmvee Solar Systems Ltd Reliance Industries Limited (Solar Energy Group)

Government Incentives
Central government incentives to States and Union territories to adopt SPV systems Encouraging energy efficiency in Special Economic Zones Incentives to Banks and Micro Finance Companies that offer finance at the micro level

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

FDI In Real Estate

Investment in Real Estate Individuals are not permitted to invest in real estate unless it is in connection with Real Estate Development or Other Investment (for e.g. Investment in an Indian company that then needs to buy an office) Real Estate Development

Services Housing Plots minimum 10 hectares Construction development projects a minimum built up area of 50,000 sq. meters Minimum Capitalization of US$ 10 million (Wholly Owned Subsidiaries) Minimum Capitalization of US$ 5 million with an Indian JV partner FDI cannot be repatriated before three years

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Statutory Permits

Reserve Bank of India (RBI) Reporting Foreign Investment Promotion Board (FIPB) approvals wherever needed Obtaining the statutory permits - local, state and national Registration under the Shops and Establishment Act Zoning licenses and new electric supply licenses Permissions to be obtained from state Industrial Development Corporation. Consent from state Pollution Control Board

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

LawQuests Areas of Practice

Transaction and Business Law Real Estate and Property Law Personal Law, Wills and Trusts Intellectual Property Law Global Immigration Law Dispute Resolution

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An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.

Thank You

An Overview of Doing Business in India by Poorvi Chothani, Esq.

LawQuest 2009. All Rights Reserved.