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About India

Located right in the middle of South Asia, India has a population of approximately 1,350 million people. It is the seventh-largest country by geographical area, the second-most populous country, and the most populous democracy in the world. It also has the world's second largest labour force, with more than 500 million people.

India provides a very good blend of a thriving domestic market opportunity, highly skilled manpower & increasingly open regulatory environment.

All these make India a favorite destination for global companies who are looking to expand their footprint and create a lasting business success.

expand about india
market india

Market Entry in India

Not considering expanding a business to India means ignoring one of the most promising new markets of the decade to come. Most major companies do already have at least an indirect presence in India through their distributors/ supply chain mechanism. However, having a direct presence would leave you with a much better control over operations, financial and marketing activities compared to such an indirect presence.Presence can be attained in many ways, such as establishing a wholly owned subsidiary/ LLP or a Branch/ Liaison/ Project Office.

Ease of Doing Business

The ease of doing business is an index created by economists of World Bank Group which ranks countries on basis average of 10 sub indices. We are delighted to state that over the years, India has leapfrogged 79 places from 142 to 63 in the World Bank’s ease of doing business rankings. India is expected to move into the top 50 by next survey and has been earning a place among world’s top ten improvers.

easy to doing business

India has undergone some major reforms within a short period of time, such as:

  • Making company incorporation cheaper by abolishing fee for simplified incorporation form
  • Making insolvency resolution easier by promoting reorganization proceedings in practice
  • Making warehouse establishment processes cheaper
  • Streamlining the processes related to construction permits
  • Making trading across borders easier. With the latest reforms, India now ranks 68th globally on this indicator and performs significantly better than the regional average

Government is constantly and dedicatedly working towards the areas which are still lacking, and bright days ahead are foreseeable!

Supportive Government Norms

India’s Foreign Direct Investment policy has been progressively liberalized to make the investment regime more investor friendly. The result of the liberal foreign investment policies is that India has been consistently rated amongst the top investment destinations globally by all international bodies including World Bank, UNCTAD.

Over the years, industrial policy reforms have largely removed restrictions on investment projects and business expansion on the one hand and allowed increased access to foreign technology and funding on the other. A series of measures that were directed towards liberalizing foreign investment included:

  • 1.introduction of dual route of approval of FDI – RBI’s automatic route and Government’s approval (SIA/FIPB) route,
  • 2. automatic permission for technology agreements in high priority industries and removal of restriction of FDI in low technology areas as well as liberalization of technology imports,
  • 3. permission to Non-resident Indians (NRIs) and Overseas Corporate Bodies (OCBs) to invest up to 100 per cent in high priorities sectors,
  • 4. hike in the foreign equity participation limits to 51 per cent for existing companies and liberalization of the use of foreign ‘brands name’

Factors to Consider Before Starting Business in India

Factors to Consider

Doing Industry specific Market Research :

Understanding the regulatory environment

Having a market strategy

Selecting the appropriate legal structure of the entity

Looking for right partners and building contacts

Keep long-term growth in mind

Understanding the business culture

Availability and Expertise of Manpower

India has the world's second largest labour force, with more than 500 million people. It is a huge pool of skilled manpower, professional managers and semiskilled and unskilled labour available at a comparatively moderate cost, often just a fraction of the rates prevailing in developed countries.

India has a large scale population making the cost of labour significantly cheaper in the country with an abundance of technically skilled manpower. The hourly rates of a developer in the developed West vary from $60 to $80. Whereas in India it can be as low as $15. The flexible pricing ensures that even small businesses have the options to suit their budget. This is why many giant companies also set up their captive units or outsource work to India.

Both Indian and multinational recruitment agencies exist in the market. The Indian work culture is immensely diverse and extremely professional. English language is used for much official communication.

Moreover, the manpower possesses the requisite expertise to provide the high-quality services without having to spend extensively. To sum it up, it is ensured that the required services are provided for at the lowest rates possible without compromising on the quality.

Indians across the world have proven to be amongst the finest workforces. Global start-ups can make the most of high-quality workforce with a strong work ethic to set up facilities like manufacturing, R&D, innovation centers and technology support for global operations.

Choosing The Right Business Set-Up

There are majorly 3 options for foreign companies entering into India:

Establish a Liaison office (LO) Merely a representative office which is only allowed to act as a channel of communication between Head Office and parties in India and can engage in promotional activities. No legal standing of its own and not permitted undertake any commercial activity – directly or indirectly and cannot thus earn/accrue income in India.

Establishing a Branch office (BO) Branch offices are extensions of Head Office. They are engaged in furtherance of their HO’s activity in India and can engage in limited operations such as export/import of goods, rendering of services, etc. They also do not have a legal standing of their own but can accrue income in India since they are allowed to undertake commercial activities.

Establishing a Wholly owned subsidiary (WOS).They are private limited companies incorporated under Companies Act, 2013 with closely held shareholding among parent and group companies. They are distinct legal entities. They are treated as a domestic company and may undertake any activities stipulated in their MOA subject to Indian laws and regulations.

choossing the right business

Company Registration Process in India

Registration process for a privately held company in India broadly involves the below steps:

Setting up a liaison office in India

  • An application is required to be submitting for establishment of liaison office in India in Form FNC Annex-1.
  • Submit Certificate of incorporation, Memorandum and Articles of Association and a copy of the parent company’s latest audited financial records.
  • Obtain Pan Card and a Unique Identification Number (UIN). Pan card will be allotted by Income Tax Department and UIN by Reserve bank of India.
  • The liaison office must enlist with the Registrar of Companies within 30 days of establishment, through the Ministry of Corporate Affair's online entry in Form FC-1.

Setting up a Branch office in India

  • An application is required to be submit for establishment of branch office in India in Form FNC Annex-1.
  • After Incorporation, the following requirements are also necessary to obtain for a branch office:
  • An application is required to be submit for establishment of branch office in India in Form FNC Annex-1.
  • After Incorporation, the following requirements are also necessary to obtain for a branch office:
    • Permanent account number
    • Tax deduction number (Tan)
    • Shop & Establishment Registration
    • GST Registration if required
    • Branch offers any types of assistance in India

Applicable Laws

Complete set of statutes and regulations that apply for a particular business shall depend on the industry it operates in, considering that there are several industry specific laws. However, a general set of laws is applicable on all businesses, irrespective of the business or entity type.

  • Companies Act, 2013 – It governs the incorporation, management and functioning, restructuring, and dissolution of companies.
  • Indian Contracts Act – governs the grounds on which contracts are valid, relating to the formation and enforceability of contracts, consideration, the various types of contracts including those of indemnity and guarantee, bailment and pledge, agency, and breach of a contract.
  • Foreign Exchange Management Act – governs India’s foreign exchange and regulates the inflow and outflow of foreign exchange and investment into/from India
  • Income Tax Act – governs the tax treatment of business profits, dividend, capital gains, mergers, and demergers
  • Goods and Services Tax Act – GST is the trade tax that is currently applicable in India, and is levied on sales of goods and services.
  • Competition Act – governs the fair competition in the market.

  • Below laws are applicable for companies that go public and trade their holdings on stock exchanges:

  • SEBI Act – governs India’s securities market regulations, public offers of securities, offers of securities by listed companies, the terms of mandatory and voluntary tender offers for shares of listed companies, and the process for delisting of a listed company);
  • SCRA – governs listing and trading of securities on stock exchanges in India and the Listing Agreement with stock exchanges;

Business Support Services

business support services

A business always has to function with limited resources by making optimum decisions to make the most out of them, but this is especially true for startups. It is not feasible to employ expert level resources for all business functions, and it is not a wise idea to do so considering usually limited scale of activities.

The businesses can save up time, funds and efforts and channel them towards their core business activities by outsourcing certain support activities to expert organizations. This also helps ensure better quality and accuracy.

These services include:

  • Not only is accounting an essential business function that gives you a snapshot of how your business is really doing, accurate book-keeping is a mandatory statutory requirement and forms basis for various forms of regulatory reporting. With accounting principles and reporting frameworks changing frequently, accurate accounting now requires expertise and vigilance. However, you can consider yourself relieved by outsourcing it to a good accounting firm.

How We Can Help You

We, at Neusource, are a team of highly experienced and trained professionals who specialize primarily in rendering set-up, support and consultancy services to start-ups. We are amongst the pioneers in the domain of expert services tailored specifically for start-ups. Having offices in multiple cities all over India, we are recognized for being a remarkable part of the start-up revolution going on in India. We offer you with a single window for solutions of all your requirements and issues. We provide various services which have been explained previously in this document, ranging from

  • 1. Assistance in ascertaining financial feasibility of your business idea
  • 2. Helping you develop business strategies
  • 3. Independently undertake entire business registration processes
  • 4. Provide you with essential support services, including:
    • a) Accounting & Book-keeping services
    • b) Tax and Legal Compliances
    • c) Funding Assistance by building financial models and project reports
    • d) Assistance in technological aspects such as website development, relationship management systems, etc.
    • e) Drafting of your Internal Policies and Practices
    • f) Payroll Preparation Services, etc

Why Choose Us

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Use it as last resort to clear ambiguities

  • How many people are required to form a Company in India?

    Minimum 2 shareholders & 2 directors (a shareholder can also be a director) are required to form a private limited company. One of the directors has to be a resident Indian.

  • Can a foreign national be a director?

    Yes, only one person in Board of Directors is mandatorily required to be Indian.

  • What are MOA and AOA?

    MOA is the Memorandum of Association, which reveals the company’s name, registered office address, aim, objects, limited liability related clause, limited paid capital, the share capital of the firm, etc.AOA is like a constitution of the company that guides it’s management and administration.

  • What is PAN and TAN ?

    PAN is Permanent Account Number, which is your unique identification issued by the Income Tax Department.

    Tax Account Number (TAN) will be used by you for withholding taxes (TDS) from credits/ payments to other parties such as employees and vendors, as required by law.

  • Can I reserve the name of my prospective company and complete the remaining registration process later?

    Yes, you have a time limit of 20 days for registering the company after name reservation

  • How much time does it really take to register a company?

    It can be as quick as one week to ten days, but if there are rejections or other queries raised by ROC, you should expect a delay. However, process does complete within 1 to 2 weeks.

  • What is DIN?

    DIN is Director Identification Number issued by ROC, which is unique for each person acting as a director in any Indian company.

  • What is DSC?

    DSC refer to digital signatures, which are used for signing documents digitally.

  • Can the foreign director have and use DSC, or does it need to be the Indian director?

    Yes, there is no restriction on foreign director obtaining DSC and signing documents.

  • What is the approximate cost for registering a company?

    The Cost of Incorporation / Registration of Pvt. Ltd Company would vary from State to state, depending upon the No. of Directors, No. of members, authorized share capital and Professional fees etc.

  • What is the maximum number of members for a private company?

    A private company can have a maximum of 200. members.

  • What is the minimum amount of capital I need to start a company?

    There is no minimum fund is required to be invested in the formation of company in India. Indian laws relax the provision of minimum amount of capital. It is suggested that to keep the capital amount of Rs 1 lakh atleast so that a good financial record can be shown to other person.

  • Is a Private Limited Company Suitable for making FDI in India?

    Yes, perfectly suitable! The private limited companies have been a hugely popular form of business entity amid foreign investors for making the direct foreign investment (subject to FDI Guidelines) in any country, by means of a wholly-owned subsidiary, a joint venture, etc.

  • Does registering a company also take care of my intellectual property?

    No. You need to register your intellectual property (trademark/ copyright etc) separately with concerned authorities.



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