India Briefing News
Business News From India



Foreign Technology Transfer Fees and Royalties in India (Feb 3)
By Cherry Bansal, Accounts Associate, Dezan Shira & Associates Feb. 3 – As India develops into an important market for foreign investors, we’ve seen a significant increase in the volume of questions that our firm is regularly asked to deal with. An important issue that is beginning to crop up concerns royalty payments for licensed component parts, and technology transfer fees. In fact, since December 2009, there have been no limits regarding lump sum payments and royalties payable, however the method of calculation needs attention to detail in order to structure the invoicing process correctly. Lump sum payments and royalty … Continue reading →


Foreign Direct Investment in India’s Single and Multi-Brand Retail (Feb 2)
As India has liberalized its single brand retail industry to permit 100 percent foreign investment, we take a look at the regulatory issues and legal structures pertinent to establishing operations in this new dynamic market. Continue reading →


India’s Per Capita Income Rises 16.9% (Feb 1)
Feb. 1 – India’s average income for the fiscal year 2010-2011 rose 16.9 percent to reach a US$1,000 average for the first time, according to data released by the Central Statistics Office this week. “Real GDP growth is outstripping population growth so per capita income has been on the rise,” stated D.K. Joshi, chief economist at Crisil. According to the World Bank, India is a lower middle-class income country. Analysts are shrugging off the milestone suggesting that India still has a long way to go. The country remains beset with poverty although, like China did in the 1980s and 90s, … Continue reading →


Vodafone Wins Landmark US$2.5 Billion India Tax Case (Jan 31)
India’s Supreme Court has ruled that the British telecom giant Vodafone does not have to pay taxes and penalties for the transaction in 2007 that saw the company acquire a 67 percent stake in Indian mobile phone operator Hutchison Essar. Continue reading →


India’s RBI Cuts Cash Reserve Requirement (Jan 30)
Jan. 30 – The Reserve Bank of India cut cash reserve requirements (CRR) for banks by 50 basis points last Tuesday to relieve tight liquidity, indicating a policy shift towards reviving growth after nearly two years of fighting inflation. With core inflation still inflexibly high, the RBI left its policy repo rate unchanged at 8.50 percent for the second consecutive review. The central bank had raised rates 13 times between March 2010 and October 2011, which made it one of the most hawkish central banks over that time period. Bond and exchange markets at first commended the CRR cut before … Continue reading →


India Further Liberalizes FDI Policy, Drops Mandatory Lock-In Period (Jan 26)
The Indian government is loosening its FDI regulations and is now allowing foreign investors the opportunity to repatriate their original investment before the expiration of a three-year lock-in period from the day it completes its minimum capitalization norm for the sector. Continue reading →


India Trade Statistics for April-December 2011 (Jan 20)
Jan. 20 – India’s exports grew by 25.8 percent over the period running from April to December 2011, reaching a total of US$217.6 billion. The Ministry of Commerce informed that over that same time-frame, imports grew by 30.4 percent and were valued at US$350.9 billion, resulting in a negative trade balance of US$133.3 billion. The Ministry also informed that India’s exports for the month of December 2011 were US$25 billion and imports stood at US$37.8 billion – coming out to a negative trade balance of US$12.8 billion. Sector-specific growth estimates for exports during April-December 2011 are as follows: Engineering up … Continue reading →


India Sees Credit Rating Upgrade (Jan 17)
Jan. 17 – Moody’s Investor Services has upgraded its rating on India’s long-term government bonds denominated in the domestic currency from Ba l to Baa 3 (from speculative to investment grade). The long-term country ceiling on the overseas currency bank deposits was also upgraded from Ba l to Baa 3 (from speculative to investment grade). Also, Moody’s had upgraded the short-term government bonds denominated in the domestic currency from NP (not prime) to P-3 (from speculative to investment grade). This short-term rating had been upgraded for the first time since it was newly assigned in 1998. Apart from this, there … Continue reading →


Wholly Owned Subsidiaries in India (Jan 13)
Jan. 13 – Foreign companies can set up wholly owned subsidiaries in sectors where 100 percent foreign direct investment is permitted under India’s national FDI policy. For registration and incorporation, a set of applications have to be filed with Registrar of Companies (ROC). Once a company has been duly registered and incorporated as an Indian company, it is subject to Indian laws and regulations as applicable to other domestic Indian companies. Establishing a Private Limited Company in India Option 1 Incorporate company with foreign directors and shareholders Option 2 Incorporate company in India with Indian directors and shareholders, and after … Continue reading →


India Allows 100% FDI in Single Brand Retail (Jan 11)
The Indian government on Tuesday agreed to allow 100 percent foreign ownership in single brand retail stores, paving the way for international businesses such as Starbucks, Ikea and Adidas to operate independently in the country without having to involve local partners. Continue reading →