Foreign companies may set up business in India any kind of one of pursuing manners while retaining its status as the foreign company:
Liaison Offices – A foreign company can open a liaison office in India to pay attention to its Indian operations, to promote its business interests, to spread awareness with the company’s products and to explore further opportunities. Liaison offices are not allowed to stick with it any business or earn any income in India and all expenses are to be borne by remittances from abroad.
Project Offices – The project office is the ideal method for companies to establish a business presence in India, if the object is to have a presence for a limited period of a period of time. It is essentially a branch office launched with the limited purpose for executing a specific upgrade. Foreign companies engaged in turnkey construction or installation normally install a project office for their operations in India.
Branch Offices – Foreign companies involved in manufacturing and trading activities outside India may open branch offices for the purpose of:
oRepresenting the parent company or other foreign companies a number of matters in India, like acting as buying and selling agents.
oConducting research, the spot that the parent company is engaged, provided the outcome of this research are made available to Indian companies
oUndertaking export and import trading situations.
oPromoting technical and financial collaborations between Indian and foreign companies.
Trading companies – Foreign companies may invest in trading companies engaged primarily in exports. Such trading companies are treated at par with domestic trading companies in accordance with the trade policy.
The RBI accords automatic approval for foreign equity around 51 per cent for setting up trading companies engaged primarily Online LLP Incorporation in India exports. All other proposals, which do not meet the criteria for automatic approval, can be addressed to the Foreign Investment Promotion Board, i.e. “FIPB”.
Wholly owned subsidiaries – Foreign companies may set up a wholly owned subsidiary, which is an Indian Company by independent legal status, distinct from parents foreign company.
Under the current foreign investment policy, a wholly owned subsidiary can be established either underneath the automatic route, if for example the conditions specified therein are complied with (specific high priority industries) or ask for approval from the FIPB.
Joint venture companies – Foreign companies may set up a joint venture company i.e. monetary collaboration with an Indian business house/company in India, that is an Indian Company with an independent legal status, distinct from the parent foreign company.
Under the current foreign investment policy, a joint venture can be established either under the automatic route, if the physical conditions specified therein are complied with or obtain an approval from the FIPB.
Foreign companies intending to construct any type of office already mentioned activities portion of the parent company or foreign trading companies in India for promotion of exports from India for you to obtain a previous approval of the Reserve Bank by submitting an application in the prescribed form to the Central Office of Reserve Bank. On approval for these cases, permission is granted initially for finding a period of three years, subject to the condition that expenses of such office will be met exclusively out of inward remittances; such offices are not permitted produce any income in In india.