Foreign Direct Investment 1. What are the forms in which business can be conducted by a foreign company in India?
• A foreign company planning to set up business operations in India has the following options : • As an incorporated entity by incorporating a company under the Companies Act,1956 through • As an unincorporated entity through • Liaison Office/Representative Office • Project Office • Branch Office Such offices can undertake activities permitted under the Foreign Exchange Management (Establishment in India of Branch Office of other place of business) Regulations, 2000. 2. How does a foreign company invest in India? What are the regulations pertaining to issue of shares by Indian companies to foreign collaborators/investors? Automatic Route • FDI up to 100% is allowed under the automatic route in all activities/sectors except the following which require prior approval of the Government : • Activities/items that require an Industrial License; • Proposals in which the foreign collaborator has an existing financial / technical collaboration in India in the same field, • Proposals for acquisi
