One can set up a business in the form of Proprietary concern, Partnership firm, Limited Liability Partnership or Private Limited Company. The form of business to choose depends on the requirement of the entrepreneur. Indian entrepreneurs have a reasonable understanding of the advantages and disadvantages of each of the forms and it is the foreign companies who have to get a clarity on this aspect.
A foreign company wanting to start their activity in India can choose either
(a) a subsidiary company (Private Limited Company) or
(b) a branch or liaison office.
The important aspects to be considered are -
- Taxation
- Repatriation of profits
- Ease of doing business