Doing Business in India

Doing business in India offers enormous opportunities for Foreign companies. However, India is a large and complex market. It should not be seen as one market, but a series of interconnected regional markets where the legislative and investment climate may change from one state to another.
It is wiser to be in India now…

• Fastest growing economy in the world
  (Current: 7% , by 2018: 7.8%)
• World’s third largest economy
  (Would double in size to US$ 4–5 trillion in a decade)
• Taxes on companies has been reduced to 25%
  (For companies with annual turnover less than 50 Crores)
• World’s second-largest telecommunication market
  (1058.86 million subscribers)
• By 2020, retail market is expected to grow to US$ 1.1 trillion
  (growing at a high rate of 20%-25% p.a.)
• World’s sixth largest pharmaceutical market by 2020
• By 2050, India will have added 300 million people
• Working age group will be more than 64% by 2021
  (15-59 years)
• Growing urban markets
  (23.1 Million people shifting from rural to urban areas in two decades)
• Low labour costs
  (Total labour force of nearly 530 million)
• Purchasing power parity, India’s economy is third largest in the world
  (Current-$ 8.7 trillion, by 2025-$ 20 trillion )

Foreign Direct Investment into India

Automatic Route

• All sectors other than sectors which are specifically prohibited or under approval route
• Should comply with sector based investment and other conditions (i.e. sectoral caps)

Approval Route

100% FDI through Government approval route

• Extraction of titanium
• Publishing of scientific & technical magazines/specialty journals/ facsimile
• Edition of foreign newspapers
• Satellites (establishment & operation)
• Pharmaceuticals (Brownfield)

100% FDI: Government approval required beyond 49%

• Telecom Services
• Broadcasting Carriage Services
• Single Brand product retail trading

100% FDI: Government approval required beyond 74%

• Existing projects of Airport

49% FDI : No Government approval required

• Infrastructure Company in the Securities Market
• Insurance
• Pension Sector
• Power Exchanges
• Defense
• Air Transport Services (Scheduled): 100% for NRI

49% FDI through Government approval route

•  Broadcasting Content Services (except Up-linking & Down-linking
  of Non-‘News & Current Affairs’ TV Channels)
•  Private Security Agencies

FDI limits less than 100%

•  Banking (Private Sector): 74% FDI is allowed. However,
  Government approval is required beyond 49%
•  Banking (Public Sector): 20% FDI is allowed with Government
  approval
•  Multi Brand product retail trading: 51% FDI is allowed with
  Government approval
•  Print Media: 26% FDI is allowed with Government approval