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India company registration

Healy Consultants Group PLC
20 March, 2014

India has been attracting a tremendous amount of foreign investors because of its oversupply of educated labor. Every year, India produces around 3 million engineering and doctoral graduates, which is more than USA and China combined. Plus, consumer demand, both domestically and globally, for Indian services industry is very high. India leads the world in offshore Business Process Outsourcing and IT outsourcing. India company registration is an ideal investment option for investors who want to take advantage of India’s large consumer demand and labor supply.

Doing business in India offers the following advantages:

1.    An Indian company can be formed with a low paid up share capital of US$ 1,615;

2.    The average monthly salary of the staff in India is US$295 according to the International Labor Organization (ILO);

3.    Average energy costs are low in India at 8 cents per Kw-hour, compared to western countries where the costs can be higher than 20 cents;

4.    India’s average annual rental costs for office space are also low at US$1 per square feet;

5.    India has amongst the lowest consumer cost index in the world. consequently, foreign entrepreneurs will find it easier to establish an India business setup;

6.    Business in India will require entrepreneurs to move within the major metropolitan cities (Delhi, Mumbai, Chennai, Bangalore etc) which are connected by cheap flights, costing on an average of US$88;

7.    India has the world’s second largest labor market with 487 million people. A massive supply of unskilled labor (360 million) is available who work at an average monthly wage of US$80;

8.    The Indian Government offers several incentives for manufacturing firms including i) tax holidays for up to 5 years for companies undertaking infrastructure projects and power projects ii) funding for approved R&D projects and iii) tax credits and insurance guarantees for export-oriented companies;

9.    English is the primary business language, with over 125 million speakers in the country. This makes it easier for foreign investors to interact with consumers, suppliers and employees;

10. Incentives are also available at the state level for IT firms. For example, firms which provide IT-related services to help under-developed states move towards e-governance will receive 100% tax credits;

For your business to legally operate in India, the following compliance regulations should be considered:

1.    An India LLA is mandated to have US$1,614 for incorporation in the country. However, this amount will be higher if certain terms like India, Asia, Global, Universal etc. are used as part of the company name;

2.    An India business setup must hold an Annual General Meeting (AGM) every 3 months i.e. at least 4 board meetings in one calendar year;

3.    A resident firm’s financial documents must be signed and dated by the manager, company secretary and at least 2 directors including the MD, apart from the statutory auditor;

4.    India company incorporation process mandates all resident firms to submit annual audited financial statements by March 31st;

5.    A publicly listed India business setup must comply with the standards issued by the Securities Exchange Board of India (SEBI), if they wish to raise capital;

6.    An India company formation with more than US$10,000 in a foreign bank account must file for Foreign Bank Account Returns as mandated by the Indian Revenue Service (IRS);

7.    India company incorporation with a minimum paid up share capital of US$16,470 is required to file a secretarial compliance certificate;

8.    The Indian company incorporation process mandates all firms with a gross revenue in excess of US$108,834 to get their accounts audited;

9.    All business must register for VAT if their annual turnover exceeds US$8,076;

With the high consumer demand and a large amount of educated labor supply, investors can be assured that India will be a highly advantageous base of operations for any services business setup.

About the Author

Healy Consultants Group PLC

Since 2003, Healy Consultants assists international Clients with company incorporation services worldwide. Our services include: company registration, opening of corporate bank account, accounting and tax services, legal services, jurisdiction comparisons...more.

To inquire more information about global business set up; call us on +65 6735 0120 or email us at email@healyconsultants.com


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