How to set up in India
The kind of entity you choose decides what you can do in India, how you are taxed and how long it takes to get started.
The options
| Structure | What it can do | Approval | Typical use |
|---|---|---|---|
| Liaison office | Representation, market research, promoting exports and collaborations; no commercial activity or income | RBI via an authorised bank | Testing the market |
| Branch office | Exports, imports, consultancy, research, technical support for the parent | RBI via an authorised bank | Specific activities without a separate company |
| Project office | Carrying out a specific contracted project | Often automatic, through an authorised bank | Infrastructure or engineering contracts |
| Wholly owned subsidiary | Any lawful business permitted under FDI rules | Incorporation with the Ministry of Corporate Affairs | Long-term operations |
| LLP | Business with partners' limited liability | Ministry of Corporate Affairs; FDI allowed in sectors under the automatic route | Professional services, smaller operations |
| Joint venture | Business with an Indian partner | Incorporation, plus partner agreements | Market access, licences, land |
Key differences
- Legal personality: a subsidiary is a separate Indian company; offices are extensions of the foreign parent.
- Tax: a branch can create a permanent establishment of the parent, taxed at rates for foreign companies; a subsidiary is taxed as a domestic company.
- Flexibility: a subsidiary can do most things; offices are limited to their approved scope.
- Time: liaison and branch offices go through RBI approval via an authorised dealer bank, often 30–90 days. Subsidiaries can be incorporated quickly once documents are ready.
Documents you will need
Foreign documents (parent's certificate of incorporation, articles, board resolutions, financial statements) usually need notarisation and apostille, and certified English translations where applicable.
Choosing
- Exploring the market for a year or two: liaison office
- Serving Indian clients on a single large project: project office
- Hiring, selling, manufacturing or running a capability centre: subsidiary
Many companies start with a liaison office and convert to a subsidiary once they commit.
