Doing business in India

doing business in India

doing business in India

Doing business in India – the fastest growing economy in the world, the second-most popular country with over 1.33 billion people, the world’s largest democracy and the seventh-largest country by area.

World Bank Report on Ease Of Doing Business In India – the Indian economy will grow at 7.6 % in 2016-17, followed by further acceleration to 7.7 % in 2017-18 and 7.9 % in 2018-19. The new visionary political leadership, favorable demographics with over 50% of the population below the age of 24 years and 65% of the population below the age of 35 years and large educated workforce have further fueled this growth.

Doing business in India offers numerous opportunities for UAE, Canada, Australia companies. 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.

SP Chopra would advised to obtain the current and detailed information from our experienced professionals for the companies are doing business in India, or have plan to do so. Countries may be UAE, Canada, Australia etc – large or small.

 SP Chopra guide will help you in doing business in India.

The key areas to consider are understanding the market, Doing Business in India serves as a guide to India’s business:

Specific Tax Concerns Related to Establishing a Company

Legal Issues Related to Establishing a Company in India

Cultural Concerns Related to Establishing A Company in India

Other Country-Specific Issues Related to Establishing A Company in India

Permanent Establishment in India | Branch or Subsidiary?

Tax And Accounting Obligations in India

Registration Formalities in India

Standard Legal Obligations and Formalities for a Branch in India

How to Hire My First Employee in India?

Design and Contents of an Employment Contract in India

Can Somebody do Business for Me and not be an Employee in India?

To facilitate the ‘Ease of Doing Business in India’, the Indian Government has taken significant measures on the taxation and the legal fronts by launching other initiatives like ‘Make in India’ and ‘Digital India.’

The Indian government has also taken up a series of measures to improve the ease of doing business in India by simplifying and rationalizing existing rules and using information technology to make the governance more efficient and effective.

India is set to climb up in Ease of doing business:

“I leave India with a profound admiration for the remarkable development gains this country has achieved in recent decades. India’s experience holds valuable lessons for the World Bank Group and for countries around the world”

Jim Yong Kim, World Bank Group President March 2013.

“The fundamentals of our country are very brilliant and I don’t see any reason why the great Indian story has lost so fast its sheen and the reason for the pessimism”

Indra Nooyi, Chairperson and Chief Executive, Pepsico, November 2013

“It is important to take a moment to remind ourselves of this country’s extraordinary achievements. Some are well known in the world at large — the emergence of a world-class IT industry, the rapid growth of exports and the development of a sophisticated financial sector. India has a strong voice in the global discussion of many key issues, including trade and climate change … These successes highlight the gradual process of reform India has undergone during these years of rapid growth. Regulatory changes have been significant… From abroad, India fits comfortably into the category of countries that  are doing well. Its growth is strong by advanced country standards …”

Naoyuki Shinohara, Deputy Managing Director, International Monetary Fund May 2013.

“Despite the current downturn, long-term prospects remain bright for India. India possesses the fundamentals to grow at sustained high rates over the next several decades”

Martin Rama, World Bank’s Chief Economist for the South Asia region April 2013.

“India’s biggest strength in the coming years is going to be her demographic dividend. More than 50% of our population is under 25 years and soon, one-fifth of the worlds working age population will be in our country”

Pranab Mukherjee, President of India while receiving the National Innovation Council’s Report to the People 2013 in November 2013.

“In the past two decades, the rate of growth more than doubled to an average rate of over 7% per annum and the Indian economy was put on an upward growth trajectory. Naturally, there will be periods of ups and downs. The economic cycle presents us years of high performance and years of modest performance. But the important thing to note is that highs are getting higher, and so are the lows”

Dr. Manmohan Singh, Prime Minister, India, at his address at the Hindustan Times Summit, 2013 in December 2013.

“India is already adding more than China to the world’s working-age population. Although this increment will lessen in the coming decades, India’s share of the global workforce will climb towards 30% by 2030 …”

Standard Chartered,  6 November 2013.

“FDI flows into India are Quite positive… think we can absorb – easily absorb – US $50b of FDI every year into India.

P. Chidambaram, Finance Minister, India April 2013.

Fundamental are still better than people believe, People are caught up in all the doom and gloom that surrounds India at the moment. But if we take a step back and do think about those fundamentals, then it seems to me that there are good reasons to believe that growth will be stronger in this current fiscal year than the last fiscal year. Fiscal policy, monsoon and the exchange rate are clearly more helpful”

–  Robert Prior-Wandesforde, Director, Asian Economics Research, Credit Suisse, September 2013.

How to Hire My First Employee? | Doing Business in India

Assessment of Statutory Compliances, Doing Business in INDIA, Establishing Company in India, Formation of an appropriate business, Periodic Compliances, Routine Compliances Matters, Compliance with Minimum Wages, employment visa in India, How to Hire My First Employee in India, Statutory Compliance

How to Hire My First Employee? – Doing Business in India

India has around 487 million workers, the second largest after China. Indian young workforce is growing rapidly and increasing energy in Indian Markets. Despite having second largest workforce in India manpower is economical.

Main Legal Steps to Follow to Hire A First Employee

Hiring first employee in India is an easy task in India.
A) For domestic employee, an entity is required to take care of two aspects only, which are as follow:

  1. Compliance with Minimum Wages, which is at present around USD $3,000 Per Annum.
  2. Compliance with provisions of withholding taxes applicable in India.

B. Hiring a Foreign resident is subject to fulfillment of certain conditions. Some of them are as follows:

  1. Employee is required to obtain an employment visa.
  2. Employment visas will not be granted for jobs for which qualified Indians are available. Employment visas will also not be granted for routine, ordinary, or secretarial / clerical jobs.
  3. Minimum Wages prescribed are USD $25,000 Per Annum.

Other Statutory Compliances
In India, labour laws related to social security of employees becomes effective when there are at least 10 employees in the entity. Some of the Labour laws applicable in India are as follows:

  1. Provident Fund (Social Security)
  2. Gratuity
  3. Employees State Insurance
  4. Professional Tax and
  5. Contribution to Labour Welfare funds etc.

Standard Legal Obligations and Formalities for a Branch | Doing Business in India

Doing Business in INDIA, Establishing Company in India, Formation of an appropriate business, Standard Legal Obligations, Formalities for a Branch in India, Monthly TDS returns, Standard Legal Obligations in India

Standard Legal Obligations and Formalities for a Branch – Doing Business in India


A. Filings:

  1. Yearly filings include the filing of audited accounts of Branch Office, World Accounts with Registrar of Companies.
  2. Yearly submission of Activity Certificate with RBI and AD Bank.
  3. Annual return with the Income Tax Department.
  4. Filing of Quarterly / Monthly TDS returns, VAT, Service Tax Returns.

B. Other Legal Obligations/Provisions:

  1. The Branch Office will not accept any deposits in India
  2. The commission earned by the Branch Office from parties abroad for any agency business will be repatriated to India through normal banking channels.
  3. The Branch office shall not undertake any retail trading activity
  4. A Branch Office is not allowed to carry out manufacturing or processing activities in India, directly or indirectly.
  5. The Branch Office is not allowed to borrow locally unless the prior approval of RBI is given.


Doing business in India

Doing business in India

The Indian economy continues to grow at a positive rate and has achieved a strong position on the global map.

SP Chopra & Co Doing business in India strategy offers an overview of India’s commercial climate and explores entry options for global businesses in India.

The Ease of Doing Business (EODB) index is a ranking system established by the World Bank Group. In the EODB index usually simpler, regulations for businesses and stronger protections of property rights.

The research presents data for 189 economies and aggregates information from 10 areas of business regulation:

1) Starting a Business

2) Dealing with Construction Permits

3) Getting Electricity

4) Registering Property

5) Getting Credit Protecting

6) Minority Investors

7) Paying Taxes

8) Trading across Borders

9) Enforcing Contracts

10) Resolving Insolvency

Starting a business

Introduction of form – 29 by MCA. With this form three processes such as Name Availability, Director Identification Number and Incorporation of Company are clubbed into one. The company can be registered within 1-2 working days in India.

Dealing with construction permits

Delhi has a uniform building bye laws, 2016 which allows for risk-based classification regimes for different building types. The uniform building bye laws have provision of deemed approval of sanctioning building plans within 30 days.

Getting Electricity

In both Delhi and Mumbai, the distribution companies have stipulated that electricity connections will be provided in 15 days and the number of documents required to obtain an electricity connection have been reduced to only 2.

Registering Property

In Delhi, all sub-registrar offices have been digitized and sub-registrars’ records have been integrated with the Land Records Department and in Maharashtra all property tax records have been digitized.

Getting Credit

This will allow uploading of data pertaining to security interests created on all types of properties covered by the definition of property in Section 2(1)(t) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI)

Minority Investors

Apart from the above-mentioned parameters, India fairs particularly well in terms of ‘Protecting interests of Minority Investors’, where it ranks 8 among the 189 countries which are part of this index.

Paying Taxes

The ESIC has developed a fully online module for electronic return filing with online payment. This has greatly reduced the time to prepare and file returns.

With introduction of e-Verification system, there remains no physical touch point for document submission to Income tax authorities.

Trading Across Borders

The number of mandatory documents required by customs for import and export of goods have been reduced to three viz. Bill of Lading, Invoice cum Packing List and Import Declaration.

Enforcing Contracts

The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 has been enacted. The Commercial Courts and Appellate Divisions have already been established in Delhi and Bombay High Court.

Resolving Insolvency

The Insolvency and Bankruptcy Code, 2016 is expected to introduce new dimensions in Resolving Insolvency in India. This is India’s first comprehensive legislation in the area of corporate insolvency.

Doing business in India focuses on aiding companies that are either doing business in India or planning an entry into the country. The report provides an intimate knowledge of the country’s evolving commercial climate. It explores India’s key sectors, investment climate, funding scenario, laws and regulations, and many more relevant areas.

What is GST | Goods and Services Tax ?


Goods and Services Tax is a multi-stage & destination-based tax that will be applied on each and every value addition.

Let’s start with the Multi-stage, there are multiple way an product goes to manufacture or production to the final sale. First stage is Buying of raw materials. The second stage is production or manufacturing. Then, warehousing of materials. Now sale of the product to the retailer and  finally the retailer sells you

Goods and Services Tax will be levied on each of these stages, which makes it a multi-stage tax.

GST will be applied on these value additions and at every point of sale.

At present, Indian tax structure is divided into two segments 1) Direct Tax 2) Indirect Taxes. Direct Taxes are applied on where the liability cannot be passed on to someone else.

Indirect Taxes are the liability of the tax that can be passed on to someone else. When the shopkeeper must have to pay VAT on his sale, he can pass on the liability to the customer.

How GST will work?

When Goods and Services Tax is implemented, there will be 3 kinds of applicable Goods and Services Taxes:

CGST: Central government will collect the revenue

SGST: State governments for intra-state sales will collect the revenue

IGST: Central government for inter-state sales will collect the revenue