Lower Cost of Entry Compared to Other Markets:
- For foreign companies, incorporating a company in India can be highly budget-friendly for entrepreneurs.
- Office spaces and rentals are significantly more affordable.
- The cost of setting up operations is generally lower than in other markets.
- Low employee cost, even for high-skilled workers.
Attractive Tax Benefits for Foreign-Owned Entities:
India offers tax incentives and treaty-based benefits for foreign companies. Such as:
- Lower Corporate Tax rate for new manufacturing companies.
- Tax exemptions for ‘start-ups’ are subject to the fulfillment of pre-defined criteria.
- Access to Double Taxation Avoidance Agreements (DTAs) helps foreign companies reduce withholding tax on dividends, royalties, and technical services.
- Foreign Tax Credit (FTC) benefits for avoiding double taxation.
- Clearly defined transfer pricing guidelines, drawing a board for foreign companies to plan their profit retention in India.
Skilled, Cost-effective workers:
India is home to trained professionals across various industries:
- IT and Software development.
- Finance and accounting.
- Design and marketing.
- Legal and research development.
Foreign-friendly Government Policies:
India has taken important steps to create a more welcoming environment for foreign investors. Several reforms have been introduced by the Indian government that simplify the process of operating a business for international companies.
- 100% Foreign Direct Investment (FDI) under the automatic route, meaning no prior government approval is required.
- Pre-defined sectors where foreign investment is permitted, subject to approvals and limits.
- Through digital portals, company registration, tax filing, and compliance formalities can be done.
- Startup India and Make in India, these programs offer incentives, easier compliance norms, and support structures.
- Introduction of GST has created a unified tax structure, while tax treaties with multiple countries provide relief from double taxation.
Robust Talent Pool for Strategic and Technical Functions:
Businesses can easily access qualified professionals such as Chartered Accountants (CAs), Company Secretaries (CSs), Lawyers, and compliance experts at competitive costs. Additionally, India offers a strong workforce skilled in international taxation, IFRS, transfer pricing, and cross-border advisory.
Conclusion:
India is no longer just a backup market; it’s a booming destination for international business growth. Its blend of tax efficiency, digital compliance, sectoral growth, and legal clarity makes it a destination where global businesses can incorporate a company in India.
At KDP Accountants, we specialize in helping foreign companies set up, operate, and scale their business in India. From entity registration and FEMA compliance to international taxation and ongoing advisory, our team ensures that your entry into the Indian market goes smoothly and compliantly. For expert guidance, reach out to us at enquire@kdpaccountants.com.
If you’re planning to expand your business in India, partner with the team that understands both regulations and international standards.
