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NRIs Starting a business in India | Open a Company For NRI in India


Steps to be following by NRIs to start a business in India. Government grants for business in India. Starting a Manufacturing Unit in India. how NRI can start a school in India.

Most NRIs wants to start a business in India as a company and that is where the problems begin.

No single person can form a company:

According to New Companies Act, 2013, NRIs, PIOs and foreigners are not allowed to set up a one person company which is applicable only to resident Indians.

Need of Indian resident:

NRIs are allowed to become directors of an Indian company. However, there are only two choices -- public and private limited. But there are number of restrictions in these two ventures too.

Steps to be taken by NRIs and PIOs to start a business in India:

  1. They need to acquire a PIO card as it offers benefits extended to an Indian citizen for the purpose of doing business. Besides, with PIO cards, they can enjoy visa-free entry for 15 years and do businesses and own property in their names. (Note: If you are a NRI then you do not require a PIO card.)
  2. Get a PAN card as any person whether a NRI or an Indian making an investment of over Rs    50,000 is required to cite his or her PAN number.
  3. If NRIs are not moving but want to run business, then they need to select a partner(s) for taking care of the venture. They have to select their partners based on their integrity and past records rather than being swayed by emotional quotient.
  4. What sort of enterprise you would like form: Partnership, sole proprietorship, company or any other form of business entity, have to be decided with due emphasis on the rules and regulations governing such entity.
  5. Make sure that your enterprise becomes a member of business associations or groups related to the sector in which your business falls.
  6. For running an export and import trade, one has to register with the Director General of Foreign Trade. The application form for the same requires a bank account number and a letter from the bank along with the details of board of directors.

Government grants for business in India

Many state governments are offering incentives to attract foreign capital and investment:

  • Land at low cost and industrial sheds for the small scale industrial units
  • Tax discounts for a period along with  exemptions from sales tax and other benefits for some time
  • Power supply at reduced tariff
  • Easy loans and subsidies at attractive rates of interest

The Central and state government offer a range of benefits and incentives to promote industrialisation of backward areas. The purpose of such incentives is to develop backward areas and provide jobs to people in those regions who otherwise had to migrate to urban centres.

Starting a Manufacturing unit

To set up a factory or industrial unit some clearances and approvals are required. Here are the clearance process one has to go through before setting up his factory unit:

  1. Company registration
  2. Environment clearance on the issue of pollution
  3. Land acquisition
  4. Power supply deal
  5. Water connection approval and other permits the local government need before okaying the proposed unit in its jurisdiction

Foreign Investment Promotion Board (FIPB) is the nodal agency that clears all investment proposals in India. The main aim of this board is to promote foreign investment in India and simplify the procedures for starting an enterprise in India with foreign capital

How to start a new school in India

  1. NRIs have to form a registered trust with a non-profit motive to open a school
  2. An Essentiality Certificate from the Department of Education is needed to acquire land for the school at a reduced price from government officials.

Strict guidelines to be followed while applying for Essentiality Certificate:

  • The applicant should clearly mention the address of society/trust in the application form
  • A memorandum of association and rules and regulations of the trust duly attested by the Gazetted Officer
  • The type of school (middle, secondary, senior secondary school) must be stated clearly
  • One can get the information on the number of school in existence in area where the new one is supposed to come up at the department’s website.
  • A copy of FDR for Rs. 2 lacs (in the joint name of the Society and the Deputy Director Education of the concerned district) valid for at least 3 years have to be enclosed in the application.


India is a great destination for starting a new business. With a market of over 1.2 billion people and a roaring economy, India presents numerous business opportunities for persons and businesses of all size and vision. India is also progressing quickly to make the process for incorporation of a company easy and quick. Therefore, there is no better time to invest in India and reap the returns.

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