Foreign Direct Investment in India:
Foreign direct investment (FDI) in India is a major monetary source for economic development in India. Foreign companies invest directly in fast growing private Indian businesses to take benefits of cheaper wages and changing business environments of India.
India has always been an attraction for the foreign companies with regards to investment. There is a large number of foreign direct investments in India that are seen in several sectors in recent times. The policies are becoming more and more liberal and hence the country is a popular destination for FDI.
Methods of FDI in India:
The foreign direct investor may obtain voting power of an enterprise in an economy through any of the following methods:
- By the means of including a fully owned subsidiary or firm anywhere
- By obtaining shares in an associated company
- Via a merger or an acquisition of a firm that is not related
- By taking part in an equity joint venture with another investor or company
FDI in India is allowed through two routes. One is Approval route or Government Route and the other one is automatic route. Let us now understand the difference between the two routes.
FDI through Approval or Government route:
Under this route, approval from the Government of India is required before making an investment. Proposals for foreign investments coming under the Government route are considered by the respective Administrative Ministry Department.
FDI through Automatic Route:
Under this route, the non-resident investor or the Indian company does not require any prior approval from the Government of India for investments in the country. That means foreign direct investment opportunities can be met without any preliminary approval from the government.
Under any route, the foreign companies need to follow the FEMA rules, FDI policies, and SEBI rules and other applicable provisions. The easiest procedure for FDI in India is indeed the automatic route. Procedure for FDI through automatic route is quite simpler and requires minimum documentation and processing.
Suggested read: FEMA compliance in India
Why Ebizfiling for getting services of Foreign Direct Investment through Automatic and direct route?
EbizFiling.com is an eminent business platform and a progressive concept, which helps end-to-end incorporation, compliance, advisory, and management consultancy services to clients all over the world. Foreign Direct Investment is easy, seamless, cheapest and quickest with us. In India we provide services like Indian subsidiary, Start up advisory, Secretarial compliance services, Filing of Form FC-GPR and FC-TRS, Trademark registration and many more.To get your FDI in India online you may get in touch with our compliance manager on 09643203209 or email info@ebizfiling.com for free consultation.