DOING BUSINESS IN INDIA

Table of content

1.0  FACT SHEET

2.0  INDIAN ECONOMY

3.0  BUSINESS STRUCTURES

4.0  CORPORATE COMPLIANCE REQUIREMENTS

5.0  ACCOUNTING, AUDITING PRACTICES, AND FINANCIAL REPORTING

6.0 TAXATION STRUCTURE

7.0  FOREIGN DIRECT INVESTMENT

8.0  INDUSTRIAL LICENSING AND CLEARANCES

9.0  INTELLECTUAL PROPERTY RIGHTS (IPRs)

10.0  EMPLOYMENT REGULATION AND LABOUR LAWS

11.0  FINANCIAL MARKETS AND SERVICES

12.0 REAL ESTATE

13.0 GUIDE TO VISA REGIME IN INDIA

FACT SHEET

Country Name: Republic of India

Capital City: New Delhi

Location: Southern Asia, bordering the Arabian Sea and the Bay of Bengal, between Burma and Pakistan

Time Zone: GMT +5.5

GDP – Purchasing Power Parity: $8.727 trillion (2016 estimate)

GDP – Per capita (PPP): $6,664 (2016 estimate)

GDP – Real growth rate: 7.5% (F.Y. 2015-2016 estimate)

Inflation Rate (consumer prices): 5.41% (2015 estimate)

Exports: $238418.11 million (April 2015 – February 2016)

Exports – Commodities: petroleum products, precious stones, machinery, iron and steel, chemicals, vehicles, apparel

Imports: $351806.61 million (April 2015 – February 2016)

Imports – Commodities: crude oil, precious stones, machinery, fertilizer, iron and steel, chemicals

Labour force: 496.9 million (2012 estimate)

Labour force – by Occupation (2012 estimate):

  • Agriculture: 49%
  • Industry: 20%
  • Services: 31%

Population: 2nd most populated country of the world – More than 1.27 billion (2015 estimates)

Government Type: Federal Parliamentary Republic

Administrative Divisions: 29 States and 7 Union Territories

Fiscal Year: 1 April – 31 March

Legal System: Common law system based on the English model; separate personal law codes apply to Muslims, Christians, Hindus and followers of other religions.

Executive: The Chief of State is the President who is elected by an electoral college consisting of elected members of both houses of Parliament and the legislatures of the states. The head of Government is the Prime Minister who is chosen by parliamentary members of the majority party following legislative elections. The Union Council of Ministers is appointed by the president on the recommendation of the prime minister.

Legislature: Bicameral Parliament consisting of the Council of States (known as Rajya Sabha) and the People’s Assembly (known as Lok Sabha)

Judiciary: The Indian Judiciary follows a rigid hierarchy with the Supereme Court of India at the top followed by High Courts of respective states with district judges sitting in District Courts and Magistrates of Second Class and Civil Judge (Junior Division) at the bottom.

Major Languages: The Official language of India is Hindi, spoken by some 35% of the population as a first language. Since 1965 English has been recognized as an associated language and is the preferred language for conducting business. In addition, there are 22 main and regional languages recognized for adoption as official state languages.

Currency: Indian Rupee (INR)

Internet Country code: .in

India’s economic liberalization measures, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and have worked towards accelerating the country's growth. As per the Economic Survey 2012-2013, in 2011-12 and 2012-13, the growth rate slowed to 6.2% and 5% respectively. Nevertheless, despite this slowdown during 2014-15, India's GDP growth recovered marginally to 7.3% from 6.9% in the previous fiscal. India's GDP growth during January–March period of 2015 was at 7.5% compared to China's 7%, making it the fastest growing economy.In the last decade, growth has increasingly come from the services sector, whose contribution to overall growth of the economy has been 65%, while that of the industry and agriculture sectors has been 27% and 8% respectively.

The Indian market provides lucrative and diverse opportunities for business and offers a liberal economic environment for the same. India’s requirements for equipments and services for major sectors such as energy, environmental, healthcare, high-tech, infrastructure, transportation, and defense will exceed tens of billions of dollars as the Indian economy further globalizes and expands. With expected continuance of the government’s liberal policies, India has potential for a sustained high growth for the next couple of years.

Companies incorporated under the Companies Act, 1956 have to file various forms, returns and documents under various sections with the Registrar of Companies (ROC) in an electronic mode within the prescribed time along with the prescribed fees or with payment of additional fees in the event of delayed filing. Physical filing of forms under Companies Act has been discontinued. All filings, since September 30, 2006, are made through e-filing using specially designed e-forms.

Apart from annual compliance requirement, companies are required to perform event-based compliance. Certain events requiring reporting compliance are allotment of shares, transfer of shares, appointment/resignation of directors/Managing Director/ Whole Time Director, change in the statutory auditors, change in registered address etc.

Further, companies have to maintain certain registers like Register of Members, Register of Directors, Register of Contracts, Register of Charges, etc. at the registered office of the company.

Foreign Companies and foreign investors are required to further follow Foreign Exchange Management Act 1999 and Reserve Bank of India (RBI) guidelines and file statements and returns as required.