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India Explores Increased Saudi Investments in It, Defence and Energy Sectors

External Affairs Minister Dr S Jaishankar visited Hyderabad House in New Delhi on Sunday, the 19th of September 2021 to receive and meet the Foreign Minister of Saudi Arabia, on his three-day visit to New Delhi. It was the first Ministerial visit from Saudi Arabia since the time of the covid pandemic outbreak.

The two Ministers discussed the status and progress of implementation of the Strategic Partnership Council Agreement including measures for strengthening the partnership between the two countries in healthcare, trade, investment, energy, defence and security.

Indian Prime Minister Narendra Modi met Saudi Arabia’s Foreign Minister on Monday, the 20th and Tweeted saying, “Pleased to receive Foreign Minister of Saudi Arabia, Prince Faisal bin Farhan Al Saud. Exchanged views on ongoing bilateral cooperation initiatives and regional situations. Conveyed my regards to His Majesty the King and His Highness the Crown Prince”

The Prime Minister reiterated the willingness of India to witness larger investment from Saudi Arabia in the country’s industrial sectors including energy, IT and defence manufacturing in an in-person meeting with Saudi Arabia’s Foreign Minister Prince Faisal bin Farhan Al Saud in New Delhi on Monday.

The two countries’ views and perspectives on regional developments were discussed in the meeting like the situation in Afghanistan, an official press release noted. Several bilateral cooperation initiatives that have been recently undertaken by India and Saudi Arabia were also discussed and reviewed in this meeting.

The historic visit of His Royal Highness Crown Prince to India in February 2019 along with the country’s Deputy Prime Minister and the Minister of Defence was instrumental in Saudi-India bilateral ties and paved the way for a promising relationship between the two countries. The Crown Prince announced a Strategic Partnership Council between the two countries, led by Himself and Prime Minister of India and supported by the ministerial representation from the two countries and encompassing the entire range of strategic relationships.

The Indian Prime Minister visited Saudi Arabia on 29 October 2019 and the two sides set up the Strategic Partnership Council as announced by His Royal Highness Crown Prince earlier. The Strategic Partnership Council formed by the two countries is to explore increased cooperation in trade and investment in several industry sectors, defence and counter-terrorism.

Saudi Arabia’s Ambassador to New Delhi, Dr Mohammed Al Sati previously highlighted that his country values India as a close ally and strategic business partner. Bilateral cooperation in areas of training, knowledge sharing and the fight against terrorism was emphasized in his speech. Dr Al Sati also praised India in its handling of the covid pandemic including the economic relief package provided by the Indian government.

The world’s largest oil exporter earlier confirmed saying that Saudi Arabia’s investment plans in India are on track and more than 100 billion USD investment in Indian petrochemical, infrastructure, refining, mining, and manufacturing, agriculture and several other sectors would be made as announced by Crown Prince Mohammed bin Salman in 2020. Saudi Public Investment Fund (PIF) already planned for an investment of approximately USD 1.3 billion in Reliance Retail and USD 1.5 billion in Reliance’s Jio platform.

The Reliance Saudi Aramco deal is also on the verge of finalization as Saudi Arabia commits a steady supply of crude oil for Reliance refineries and makes an investment in India’s energy sector by purchasing a stake in Reliance Industries for an estimated 20 to 25 billion USD. An investment in the West Coast refinery petrochemical project is also on the cards as per a report. A complete guide on doing business in India is helping Saudi entrepreneurs and investors in planning and launching their Indian business operations.

The Indian Prime Minister in the recently held meeting with the Saudi Foreign Minister sought greater investments from Saudi Arabia and urged that Saudi entrepreneurs come for new company formation in India in energy, IT and defence manufacturing as these sectors can offer huge growth opportunities to benefit from. Saudi Arabia’s efforts in ensuring the safety and health of Indian ex-pats and workers during the Covid-19 pandemic was also appreciated by the Prime Minister.

The recent political crisis in Afghanistan was also discussed between the Saudi Foreign Minister and Indian External Affairs Minister. India has taken a ‘wait and Watch’ stance and also started discussions with other gulf countries e.g., UAE, Qatar, and Bahrain, Jaishankar remarked.  Indian Prime Minister, Narendra Modi had earlier said that the matter regarding recognition of the new set-up in Afghanistan should be a collective decision of the global community.

Both the EU and the Indian Government are Enthusiastic to Resume FTA Talks

Both India and the EU are seen as enthusiastic to resume long-awaited talks on a bilateral free trade agreement that was on hold for almost eight years. Fresh negotiations are expected to focus on key issues including access to each other’s markets for goods and services, investment protection and geographical indications. The commerce minister announced the Indian government’s plan to revive talks in September 2020 and was further confirmed during the India-EU leaders’ Meet in May 2021.

The introductory talks on broad-based trade and investment agreement (BTIA) are likely to begin in September after being suspended in 2013 due to non-agreement between the two parties over issues including reduction of import duties on automobiles and alcohol; greater access to the financial services market by Indian companies and; higher mobility for Indian professionals in the European countries by liberalizing the visa regime.

The BTIA will be based on initial recommendations from industry groups. As per the Trade Policy Council of India, the trade deal will be beneficial for the country.

For the EU, this will be the first such FTA with an emerging economy.

The Indian government has been eager to restart the trade negotiations as it wants to establish trade pacts with countries that are not under Chinese influence. The ” Make in India” and “Atma Nirbhar” campaigns to put India as a regional leader and global manufacturing hub are also one of the reasons for initiating talks on trade agreements. Economically, a well-negotiated FTA will promote trade and investment flows and would attract European businesses for company formation in India.

On the other hand, the EU is willing to re-establish strong economic and trade ties with India through the BTIA especially after Brexit and wants to strengthen its role in governing global trade. For Europe, the FTA would provide access for EU businesses to the huge Indian market of more than 1.3 billion people including vast skilled resources and cost-competitive professional services e.g. accounting and payroll services in India.

According to the European Commission, the EU is the third-largest trading partner of India, accounting for 62.8 billion euro worth of trade in goods in 2020 which comes as 11.1% of total Indian trade, after China, 12 % and the US, 11.7 %. The UK was the largest trading partner among all the European nations and accounted for bilateral trade worth 12.29 billion dollars with India in 2020-21. Trade-in services between the EU and India touched 39.78 billion dollars in 2020.

Export promotion councils in India have been advised by the Commerce Ministry to identify sensitive areas and product & service types requiring protection including those needing greater access to the EU market. Besides the Export Promotion Councils, several industry bodies including CII, Ficci and the FIEO have also been asked to offer recommendations.

Arpita Mukherjee, a trade economist of the Indian Council for Research on International Economic Relations (ICRIER) spoke favourably for a mutually beneficial trade agreement however commenting “I do not think that the negotiations are less complex now and we need to be prepared for the negotiations. There are new areas of negotiations like e-commerce or public sector enterprises or carbon tax. India needs to have industry consultations and conduct research to develop a position that is beneficial for the country.”

“There are some sectors where both India and the EU had reached a consensus when they decided to put the negotiations on hold in 2014. These include reduction in tariffs in many products, for example, zero for zero in case of apparels,” she remarked.

Mukherjee also highlighted saying “It may be easier to move forward if such sectors are not opened up again for tariff discussions. Some issues that India had raised earlier like intra-EU labour mobility-related issues have been addressed by an EU Directive.  This can be resolved easily.”

“India has discontinued its bilateral investment treaties with the EU member states and hence the focus of the EU is to have a clear and transparent investment agreement. The EU may look at EU-China as a model investment agreement to be replicated with India and the Indian side needs to see whether we are ready to discuss issues like public sector enterprises, and subsidies,” she added.

More than 15 rounds of talks had happened on the BTIA over 6 years from 2007 and 2013 however couldn’t be concluded as India chose to discontinue the then-existing bilateral investment treaties (BITs) in 2016 with 23 EU nations. The EU though asked India to let individual agreements remain enforced until a new deal is struck.

The Indian government has made it clear that all future negotiations on trade and investment need to be negotiated under the model BIT framework issued in 2015 that would refer to individual deal agreements with other countries.

The FTA should be a win-win for both India and the EU and help promote the benefits of globalization which have been adversely impacted due to geopolitics over the last two decades.

Policy Reforms have made India a Great Place for Investment Finance Minister Asserts to US Investors

Union Finance and Corporate Affairs Minister of India, Nirmala Sitharaman addressed U.S. investors in a meeting on June 24, 2021, noting that India’s present fiscal situation is well under control and in all expectations would only improve further confirming the country’s strong post covid economic resilience.

The U.S.-India Strategic Partnership Forum (USISPF) convened a global investors’ meet where Ms Sitharaman emphasized that the government has demonstrated sound and adequate records of ‘reform implementation in the last six years and successfully exhibited the ‘strong relief and reforms undertaken during the pandemic times’.

“Macro-economic stability, infrastructure-led economic growth opportunities, financial sector reforms and positioning as a strong player in global supply chains are just some of the ways India continues to rise as a global economic powerhouse,” she added, highlighting that there was a considerable drop in new virus infections and also a significant decline in the spread of the second wave.

Representatives of reputed multinational companies including Mastercard, Metlife, Prudential, Dell, Softbank and Warburg Pincus participated in the meeting. The Finance Minister broadly explained India’s vision to make the nation ‘self-reliant and modern’ through the ‘Atma Nirbhar Bharat Programme’ and based on the fundamental building blocks for self-reliance of 5 ‘I’s including Intent, Inclusion, Investment, Infrastructure and Innovation.

The Finance Minister expressed India’s commitment to forging a long term business relationship with U.S. investors and proposed to meet them two times in a year.  “The continuous reforms make India a great place to do business and the highest ever GST collections shows the bright spot — more formalisation of economy and tax compliance,” Ms Sitharaman told the U.S. investors as reported in an official statement.

Emphasising India’s ‘continued macro-economic stability and resilience in economic recovery in the recent months’, the Finance Minister said India’s wide-ranging reforms continue to position the country as an attractive destination for foreign investors. There are ‘new opportunities emerging for foreign investors with recent FDI reforms, privatisation policy and PLI (production-linked incentive) scheme’, she pointed out. It is noteworthy that the foreign investment process has been made much simpler now and company registration in India by foreign investors can be done online without any red tape.

“Innovation and R & D have great potential. New opportunities are emerging for foreign investors with recent FDI reforms, privatisation policy and PLI scheme,” the Finance Ministry said in a press briefing, summarising the Finance Minister’s message at the USISPF meeting. To register your company in India from USA has never been so straightforward before, not needing the U.S investors to be physically present anymore during their company establishment, the ministry informed.

First Solar CEO Mark Widmar appreciated ‘the effort done already towards the investment opportunities in India, especially with the combination of industrial policy and the trade barriers that have enabled this initiative’, a ministry spokesperson reported. Mr Mark was also encouraged to see the vaccination and economic progress, the statement added.

India had 15 new unicorns in 2021 that reinforced India’s growing startup ecosystem ‘to be amongst the best in the world’, commented Ms Sitharaman. Economic Affairs Secretary Ajay Seth explained the bigger themes of the recent Union Budget and the far-reaching positive and beneficial consequences to be realized.

Bengaluru Figures in the List of Top Five Technology Centres in the Asia Pacific

Bengaluru has emerged as the top five technology centres in the Asia Pacific region including Beijing, Shanghai, Shenzhen and Singapore in a report published by Colliers, a diversified professional services and investment management firm with a global presence. Hyderabad is another Indian tech city that could find a place in the top 10 list of the report titled ‘Growth Engines of Innovation: How Asia Pacific’s Technology Hubs are Reshaping Regional Real Estate property markets.’

As the Asian technology groups make plans for their future business expansion through company formation in India and other regions, the in-depth study made by Colliers should come in handy for ascertaining the most valuable technology submarkets amongst the Asia-Pacific (APAC) cities. The report also provides opportunities to the property owners who can focus on these cities for future investment and property development opportunities.

While the report mentions Shangdi in Beijing as one of the already established submarkets; some other APAC cities including Yangpu in Shanghai, Hitec City in a Suburban Business District in Hyderabad, Sydney’s CBD South Whitefield and North Bengaluru in Bengaluru are highlighted as the developing real estate submarkets. Tech companies wanting company formation in Bangalore can obtain valuable insights from this detailed report.

“While Bengaluru has been ranked in the top five technology centres in APAC, we also witness Hyderabad in the Top ten list. Offering a compelling balance of infrastructure and talent for occupiers and well-positioned to deliver future growth and investment opportunities for owners, ORR in Bengaluru is the epicentre of commercial leasing,” noted Arpit Mehrotra, the Managing Director, Office Services-South India in his comments.

“In addition, while smaller than Bengaluru, Hyderabad is also attracting talent and multinational companies to the city. Rents are 15% to 20% cheaper than in Bengaluru. Overall, we foresee the South India markets leading the pack in terms of office leasing demand for the technology sector,” Mehrotra emphasized.

The technology sector is presently considered the most important business sector across the world comprising 65% of the top 20 public companies globally by market capitalization.

Almost 20% to 25% of leased office space demand will be contributed by the tech companies in the APAC region over the next five years as many Asian technology companies especially the Chinese have started investing and developing real estate to rapidly expand their businesses. Technology companies have already pumped in almost 10 billion USD for acquiring APAC real estate assets.

Senior Director and Head of Research- India operation, Siddharth Goel noted, “Demand from technology occupiers has been the mainstay of Indian commercial real estate. After reaching highs of 65-70% share in annual leasing volumes in the 1990s and 2000s, though the share declined to around 45-50% share in the last decade, technology occupiers are expected to increase their share in the post-pandemic period.”

“Also, Indian office real estate is expected to maintain its competitive advantage over its APAC peers as over 45% of the submarkets in top established and upcoming categories are from the cities of Bengaluru, Chennai, Delhi NCR, Hyderabad and Pune. This is further supported by our research that shows that about 70% of the tech occupiers are MNCs compared to an average of 30-40% in many other APAC cities,” Mr Goel remarked.

Besides the rent and rental growth, the availability of quality spaces at competitive rentals also decides the future growth prospects of technology occupiers and Delhi NCR has also been named amongst the top ten cities by property factors in outside cities with considerable office spaces.

Bengaluru, Hyderabad, Shenzhen, Delhi NCR and Manila have also been identified as top markets by property factors with large space in new or outlying districts.

“Delhi NCR’s micro-markets of Noida Expressway and Golf Course Extension Road in Gurugram have been featured amongst the top ten emerging submarkets in the APAC region for Tech occupiers, which is expected as technology companies are coming out of an extended work from home scenario and raring to go and perform in an office setup,” remarked Managing Director, Regional Tenant Representation-India, Bhupindra Singh.

He also emphasized saying, “We foresee buoyancy in the Delhi NCR market, and once the restrictions are fully lifted, the market will witness an upswing. Colliers forecasts an increase in uptake from the SME segment, moving towards economical micro-markets in the NCR, like NOIDA and Golf Course Extension.”

Convergence of Indian Accounting Standard (IND AS) with Global Accounting Framework IFRS

Early 2009, India committed to converging IND AS with IFRS in the G20 meeting however suspended its implementation due to some tax issues. The matter again came up during the 2014-15 Indian union budget and the Ministry of Corporate Affairs (MCA) started working in this direction jointly with the Institute of Chartered Accountants (ICA). As of now, 123 countries across the world have already converged their accounting standard with IFRS and India too, as one of the growing world economies is preparing to do so.

Ind-AS and IFRS

Indian law stipulates that all corporate establishments including their auditors must adhere to a standardised set of rules in preparing, reviewing and reporting financial statements to standardise the accounting process and for the ease of comparing financial information amongst companies and accurately predicting the financial health of individual corporates. Ind AS is the accounting standards issued by the Accounting Standards Board (ASB), a committee governed by the Institute of Chartered Accountants of India (ICAI) and represented by government bodies, academicians, and professional institutions such as CII, FICCI, ASSOCHAM, ICAI. MCA, on the other hand, decides on the scope and applicability of these accounting standards and has notified some 39 Ind AS for mandatory adherence.

For consistency in accounting language, practices and statements to improve transparency, International Financial Reporting Standards (IFRS) has long-established some common rules issued by the International Accounting Standards Board (IASB).  The rules specify requirements for maintaining and reporting company books of accounts defining types of transactions and other accounts related activities that affect companies financially. The  IFRS  Foundation stipulates  the  standards  to  “bring  transparency,  accountability  and  efficiency  to  financial markets  around  the  world…  fostering  trust,  growth  and  long-term  financial  stability  in  the  global economy.”

The Ind AS are named and numbered in the same way as the IFRS. The National Advisory Committee on Accounting Standards (NACAS) recommends these standards to the MCA.

Applicability of Ind-AS

As per the Companies Act, 1956, Sub-section 3(A) to 211 specifies that corporate financial statements be compiled as per Indian accounting standards including profit-and-loss accounts and balance sheets and makes these standards mandatory for the following entities

  • Listed companies with listing in India as well as abroad
  • Companies with a net worth of less than Rs 500 crores and preparing for being listed
  • Holding companies, subsidiaries and joint ventures of listed companies
  • Unlisted companies with more than Rs 250 crores net worth
  • Non-Banking Financial Companies (NBFC) exceeding a net worth of Rs 50 crores
  • Holding companies, subsidiaries and joint ventures or associates of NBFCs, with more than Rs 50 crores net worth
  • Unlisted NBFCs with a net worth between Rs 250 crores and Rs 500 crores
  • Holding companies, subsidiaries, joint ventures or associate companies belonging to unlisted NBFCs having a net worth between Rs 250 crores and Rs 500 crores

Other companies not mentioned above may set their own accounting rules in preparing their financial statements under Section 129 of the Companies Act, 2013. However, once a company decides to follow the Ind- AS, it cannot revert to previous accounting methods.

Moreover, once a company goes for Ind-As it becomes automatically applied to all its holding companies, subsidiaries, associated companies and joint ventures, irrespective of its qualifying status.

For Indian companies that have foreign operations, stand-alone financial statements may be made, with the Individual country-specific jurisdictional requirements apply to all Indian companies with overseas operations and these companies must also report their financial numbers as per Ind-AS for their parent company in India.

Benefits and Challenges of Ind-As

 Though strongly recommended owing to several benefits, it also comes with its fair share of challenges while converging Ind-AS with IFRS because of many regulatory and other issues involved.


  1. Enhanced accessibility of Indian companies to the world’s financial capital markets for raising foreign funds on cheaper and more favourable terms facilitating business growth and expansion.
  2. Increased cross Border trade and Investments as the foreign listing will be easier for Indian firms with new market penetration.
  3. Reduced financial reporting as separate and duplicate financial statements will no longer be needed for Indian Companies saving time and money.
  4. More access to knowledge and skills from foreign counterparts.
  5. Higher quality of financial reporting with improved reliability and better acceptability amongst international investors.
  6. Skill development and better career prospects of Indian accounting professionals in foreign countries.


  1. Difficulty in implementation due to inadequate training and skills and a greater need for additional training and qualification.
  2. Legal hurdles requiring amendments in Companies Act 1956, SEBI act 1992, IT Act 1962 etc.
  3. Different results for company performance & earnings due to different systems in determining the value of assets.
  4. An increase in investment and cost due to a need for IT systems overhaul.
  5. Difficulty in implementation in the SME sectors, a major contributor to the Indian economy due to lack of skills and resources.

Though IFRS convergence with the Ind-AS and a successful transition is a big and challenging task, once implemented the Indian businesses can reap significant benefits out of it. Additionally, Indian businesses establishments cannot afford to be indifferent at a time when the government’s topmost economic objective is attracting more foreign investments in India.

The newly framed Ind-AS are the converged form of IFRS and ICAI and, most of the provisions of IFRS have been accepted by MCA as it is.  Barring a few items, almost all other provisions are the same as IFRS.

India Enjoys Growing Trade and Investment From the UK

India and the UK share long historic ties and as one of the leading G20 investors, the UK has made an investment of 29.56 billion USD in India since 2020 and the number of UK businesses has jumped more than two times during this period with many new India company formation.

The sectors that have been witnessing strong investment growth are healthcare, consumer goods, retail, and infrastructure. Both the countries have long been working to strengthen and improve the trade and investment relationship including enhancement of collaboration in technology and pharmaceuticals.

India having the world’s third-largest startup base can join hands with the UK which has the third-largest Unicorn base in the world to create business growth and employment.

There is no bilateral free trade agreement (FTA) between the UK and India however as a part of a roadmap to future FTA and during the 14th Joint Economic and Trade Committee (JETCO) meeting convened in 2020; trade and investment ministry officials from both countries committed to set up Enhanced Trade Partnership (ETP) between the two countries expected to be officially launched during the visit of the UK Prime Minister during 2021.

UK Investment Status in India

In collaboration with the Department of International Trade (DIT) and Confederation of Indian Industry (CII), Grant Thornton Bharat a reputed consultancy firm in its ” Britain Meets India” report emphasized a stronger trade and investment relationship between India and the UK, especially after covid and post-Brexit. The report highlighted some facts about some information on UK investment in India as under

  • UK FDI in India increased from USD 898 million in 2015-16 to USD 1,422 million in 2019-20.
  • 572 UK companies in India contributed a total turnover of 46.73 billion USD providing direct employment to 416,121 people
  • The goods and services sector contributed to 26.7 billion USD during 2020
  • India is the preferred country for the UK for economic partnership especially post Brexit
  • Top-ranked sectors being watched by the UK companies are industrial and business service sectors with Maharashtra topping the list of preferred investment destinations followed by Haryana, Delhi, Tamil Nadu, Telangana, and Karnataka.
  • Enhanced and continued business collaboration during post covid made India-UK trade and investment partnership stronger.
  • Supply chains for Indian pharmaceutical products and surgical masks remained uninterrupted for the UK and other countries as humanitarian gestures including future investment for mutual economic prosperity
  • Relentless collaboration between the two countries in the research, design, and manufacturing of vaccine has further enhanced the investment relationship between the two countries
  • Dyson Technology, Aviva Life Insurance, Diageo Business Services, RMD Kwikform, and FMC Technologies have been termed as the fastest growing UK companies in India, and Vedanta, Vodafone, Hindustan Unilever, United Spirits India have become the top 20 UK companies by revenue. I
  • Top UK employers in India include G4S Group, Vedanta Resources, and HSBC Holdings

Sector-Specific Business Opportunities in India for UK Investors

 As per Invest India report, the following Indian business sectors are drawing maximum interest amongst the UK investors

Indian Chemicals sector nearly contributes to 3 percent of world production of chemicals with more than 80,000 products and generating more than 2 million people and permitting 100 percent FDI through faceless automatic route. Tata Chemicals, Atul, Reliance, and Asian Paints are major players in this segment.

The electronics and Telecommunications sector with smartphone manufacturing is the second-largest in the world with a projected turnover of approximately 400 billion USD by 2025. FDI up to 100 percent is allowed through an automatic route. Consumer and industrial electronics, computer hardware, and LEDs do also come under this sector and Samsung, Apple, LG, Intex are the major players.

The Food Processing segment is the second-largest in the world and dairy, fruits, vegetables, poultry, fisheries come under this sector with 55 mega food parks spread across the country. Britannia, Nestle, Amul, and Hatsun Agro are some major players, and 100 percent FDI is permitted through the automatic route.

The E-commerce and Retail sector is the third-largest in Asia and online grocery, e-pharmacy, and social commerce are the sub-sectors. 100 percent FDI is allowed and Adidas, Marks & Spencer, Dyson are some major players.

Aerospace and Defense sector with the second largest armed forces and worth 42.7 billion USD allowing 49 percent FDI under automatic route and 100 percent under the government route with BEL and HAL being the major players.

The IT and Business Process Management (BPM) sector contributes to 8 percent of the country’s GDP with more than 500,000 high skilled professionals.

Why Choose India Over Other countries

As per the recent forecast, India would be the third-largest economy in the world with a huge domestic market and has considerably eased the process of How to register a private limited company in India for improving the country’s ranking in the ‘ease of doing business index.

The following are some reasons that are attracting overseas investors to do business on Indian Soil

  1. India has received 73.45 billion USD FDI inflow in 2019-20 and one of the fastest-growing economies
  2. Global maritime trade to shift from the Pacific to Indian ocean providing India growing economic influence
  3. India improves its position in global innovation index 2020
  4. India has the largest youth population in the world
  5. National Infrastructure Pipeline initiative has been announced and is being undertaken for providing world-class infrastructure facilities
  6. Rising global competitiveness and drastic improvement in Global Competitiveness Index
India Enters into Defence and Trade Agreements with Mauritius and Extends 100 Million USD Credit

In a significant development and approved by the union cabinet, India recently entered into a USD 100 million Defence Line of Credit agreement with Mauritius, the first such pact with an African country as a part of the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) also called Foreign Trade Agreement (FTA)during a visit by External Affairs Minister S. Jaishankar during his visit to Mauritius.

“Privileged to witness along with Prime Minister Pravind Kumar Jugnauth the signing of Comprehensive Economic Cooperation and Partnership Agreement, India’s first such agreement with an African country. This will help focus on post-pandemic economic recovery and enable business expansion and greater investments,” Mr. Jaishankar said to the media after signing the agreement.

The new framework under the CECPA will allow India a greater entry for Indian goods into the African continent especially for several items including surgical equipment, medicine, and textile products.

A limited agreement by nature, CECPA will cover trade in Goods, Trade in Services, Rules of origin, Technical Barriers to Trade (TBT), Sanitary and Phytosanitary (SPS) measures, Dispute Settlement, Movement of Natural Persons, Telecom, Financial Services, Customs Procedures, and Cooperation in other areas. This will also include 310 export items for India such as foodstuff and beverages, agricultural products, base metals and articles, electrical and electronic items, plastics and chemicals, wood, etc.

“Just to illustrate some of the benefits, Mauritius will get preferential access for export of 40,000 tonnes of sugar into India early frame,” highlighted Mr. Jaishankar. Mauritius will also receive preferential access for the export of 7.5 million pieces of apparel in addition to other 615 products such as frozen fish, specialty sugar, biscuits, fresh fruits, juices, mineral water, beer, alcoholic drinks, soaps, bags, medical and surgical equipment.

A $100 million Defence Line of Credit for Mauritius was also announced. This would “enable the procurement of defense assets from India” according to the requirements of the country which was emerging as an important maritime entity in the Indo-Pacific region. “These initiatives underline once again that the security of Mauritius is the security of India; in the prosperity of Mauritius is our prosperity,” Mr. Jaishankar remarked adding that Mauritius would get a Dornier aircraft and an Advanced Light Helicopter Dhruv on a lease that would help strengthen its maritime security capabilities.     

Mr. Jugnauth emphasized that the agreements signed between the two countries would “consolidate the strong ties” between India and Mauritius further and promote foreign direct investment of Mauritius and new Mauritian company formation in India. Notably, during April September 2020, Mauritius ranked 4th in foreign direct investment in India.

The Chagos Archipelago dispute also came up during the discussion, which was an issue of sovereignty and sustainable development before the United Nations. In 2019, India voted for Mauritius at the U.N. General Assembly on this issue. India was amongst the 116 countries that demanded that the U.K. end its “colonial administration” from the archipelago.

“I assured the Prime Minister of India’s steadfast principled support on this issue as has been demonstrated in the past,” noted Mr. Jaishankar.

Me. Jaishankar also reaffirmed India’s medical support to Mauritius in the aftermath of the covid pandemic supported by the recent delivery of 100,000 Covishield vaccines to the African nation. Covid vaccine supply was a “clear and telling demonstration” of the strong bilateral relationship between the two countries, he remarked.

India’s External Affairs Minister also reviewed the status and progress of the India-assisted development projects in Mauritius and invited Mr. Jugnauth for a visit to India.

About business and investment in the services sector, Indian service providers will have access to around 115 sub-sectors from the 11 broad service sectors including computer-related services, research & development, telecommunication, construction, financial, tourism & travel, entertainment, transport, professional services, etc.

India too offered approximately 95 sub-sectors from the 11 broad services sectors, including professional services, R&D, and other business services, and invited Mauritius investors for setting up a company in India.

Both sides have also reached an agreement for an Automatic Trigger Safeguard Mechanism (ATSM) for negotiating on a limited number of highly sensitive products within two years.

India Mauritius bilateral relationship is deep-rooted supported by historic cultural affinities, regular and frequent high-level political interactions, development cooperation, defense and maritime partnership, and people-to-people connection.

Mauritius being an important development partner, India had extended a ‘Special Economic Package’ of USD 353 million to Mauritius in 2016.

Why and How UK Investors Register and Incorporate Companies in India? All You Need to Know


The United Kingdom and India enjoy long-standing business legacy and deep-rooted diplomatic and economic ties with a strong existing robust bilateral investment relationship that is all set to further flourish during the post Brexit era and boost up UK’s investment for many new India company incorporation.

How is UK India Business Relationship?

Several facts and figures available from the UK India Business Council demonstrate the strength of the relationship and the strong business ecosystem the private sector companies have built-in India. From 2000 to 2016, the UK invested approximately $24 billion in India and increased its investment by almost 8 per cent. between 2015 and 2016. The UK also ranked as the largest of all foreign investors into India.

The operating environments in both countries are congenial to mutual investment and business relationships. An ongoing focus on ease of doing business is expected to give huge dividends.

A Bilateral Investment Treaty providing, protecting and promoting FDI flows would be the harbinger towards a long-term UK-India trade and investment relationship where lots of future scopes exist that can mutually benefit the two countries and enable the potential of both the economies to be realised in the fullest extent. It is also noteworthy that both governments are striving hard to push the pace of their country’s economic development.

The long legacy and historical ties have put India as one of the preferred business destinations for many UK companies, and the UK Government is firmly committed to promoting its existing investment relationship with India, world’s largest democracy and marketplace with great economic powers.

There has been a sharp increase in the number of UK companies entering India since 2000 and the number of new business incorporations over the last two decades greatly outnumbered those that took place in the entire 20th century.

Why an UK Investor Should Register and Incorporate a Company in India?

Following are some key reasons prompting the UK investors for a business set up in India

1. Improved Ranking in Global Competitive Index

2. Improvement in Ease of Doing Business Index

3. Make in India and Swachh Bharat, Clean India Campaigns and Digital India Initiative

4. Improvement in Online Application System for starting a business

5. Betterment in Credit Access

6. More Transparent Payment of Taxes

7. Introduction of GST for a more uniform tax system

8. Improved Legal System

9. Greater Political Stability

10. An young and talented workforce

What Should be the Market Entry Strategy in India?

A private limited company formation is the commonest, easiest and fastest type of Indian market entry strategy for foreign nationals and foreign companies with 100 per cent foreign direct investment into a private limited company or limited company under the automatic route where no Central Government permission is needed. Thus incorporation of a private limited company as a wholly-owned subsidiary of a foreign company or joint venture is the cheapest entry strategy for foreign companies and foreign nationals into India.

A private limited company provides limited liability protection to its shareholders and In the event of any unforeseen losses giving rise to statutory or legal liabilities, the shareholders of the company are not held responsible. Private limited companies can raise equity capital from prospective persons or entities interested in becoming a shareholder. Companies can also raise money from angel venture capital firms, private equity firms, hedge funds and arch investors. Debt financing from banks, NBFCs and other financial institutions are also possible.

How do UK Investors Register and Incorporate a Company in India?

The registration and incorporation of a private limited company can be done in less than two weeks subject to the availability of the following documents.

  • PAN Card
  • Residential Proof
  • Authorization letter from the Landlord of registered office space
  • Address Proof
  • Registered Office Proof
  • Proof of any utility service like telephone, gas, electricity, etc.

The procedural steps on how to register private limited company in India are documented in details online and include the following

Step 1. Submission of Application for digital signatures to eMudhra

Step 2. Submission of Name Approval Request to MCA

Step 3. Preparation and collection of incorporation documents based on the MCA approved name

Step 4. The signing of incorporation documents by all Directors & Shareholders

Step 5: Submission of incorporation documents to MCA for approval

Step 6. Incorporation of the company

Step 7. Issuance of incorporation certificate & PAN

The Fine Print

The Indian government is putting all-round efforts to protect and promote FDI inflows and promising to secure a long-term UK-India trade and investment relationship and help close existing gaps and enable the full potential of both the economies to come to a success.

The UK is constantly seeking to build strong relationships with India after Brexit by realizing the enormous business opportunities due to the recent announcement of India government’s manifesto proposing to spend more than £1 trillion on infrastructure and nearly £10 billion for farming with continued policy reforms. The results should be positive for companies in housing, transport, construction, property, agriculture and financial investment sectors.

Indian 2021 Foreign Investment Outlook Shows Plethora of Investment Opportunities in FMCG, Pharma, E-Commerce, IT and Electronics Sectors

India continues to provide a thriving business environment to foreign investors since economic liberalization in 1991 and its economy is all set to touch new highs in 2021 with businesses returning to the pre-pandemic level.

Though the covid19 is still not completely gone, Indians have learned to fight this menace. Fewer cases are being reported daily and the average number of infections is down by more than 70 percent from peak levels. Vaccines have also arrived in the market raising hopes and optimism amongst business owners and investors in addition to the proposed growth-oriented and business-friendly union budget for the coming financial year.

The IMF predicts more than 11 percent GDP growth for India and even Nomura expects India to be the fastest-growing Asian economy in 2021 with a forecast of around 10 percent economic growth in 2021 and far exceeding that of China and Singapore.

Other agencies including Standard & Poor (S&P) and Fitch have also revised their ratings of India’s growth forecasts on account of India’s success in containing the virus and speeding its economic revival. For the next financial year 2021-22, S&P has now projected India’s growth to rebound at 10 percent and Fitch Ratings at 11 percent.

Indian government regularly eased foreign investment policies to encourage FDI inflow facilitating the economic development of the country. Low labor costs, attractive incentives for new manufacturing enterprises, skilled and talented human capital, and a reduced corporate tax rate are driving India towards becoming an alternative hub for the global manufacturing supply chain.

The Government has also introduced its number of policy actions to make the country a global manufacturing hub with the visionary plan of ‘Atma Nirbhar Bharat’ or ‘Self Reliant India’. ‘Vocal for Local’, ‘Swachh Bharat’ and ‘Make in India’ initiatives have been supported by business-friendly reforms and various incentive schemes to attract foreign companies and investments into the country.

The year before last, the government of India lowered the corporate tax rates for new manufacturing companies from 25 percent to 15 percent, effective tax rate being 17.01 percent, inclusive of surcharge and cess allowing India to compete with other ASEAN emerging economies for foreign investment. India’s huge domestic market with more than 1.3 billion population including its diverse business sectors also lures foreign investors for setting up a company in India.

In November 2020, the government also planned to incentivize 10 core sectors through an extension of the Production-Linked Incentive (PLI) scheme with incentives totaling INR 1.46 trillion i.e. approximately USD19.54 billion annually. Three sectors already benefiting from PLI are mobile manufacturing and electric components, pharmaceutical, and medical device manufacturing.

With an initiative of automatic faceless compliance route, ease of doing business has been vastly improved as well the total elimination of bribery and corruption and the recent clearance of Apple’s three major manufacturing partners including Foxconn, Wistron, and Pegatron along with Samsung Electronics for USD 143 billion Make-in-India investments are the proof of it.

The following business sectors are very attractive for investments and new company formation in India

The Fast Moving Consumer Goods (FMCG) sector growing 10 percent annually and expected to double in 2021 to a whopping USD 11.15 trillion is the fourth largest contributor to Indian GDP, fuelled by rising income and growing youth population, increasing disposable income in rural India with lower market penetration, investment approval of 100 percent equity in single-brand retail and up to 51 percent in multi-brand retail, consistent demand through the year and PLI.

India, popularly known as the pharmacy of the world is the largest provider of generic medicines globally and is the third-largest pharmaceuticals industry in the world by volume. Rising healthcare awareness due to the pandemic will act as a major driver of growth for this sector.

Pandemic has forced many Indians to avoid physical brick and mortar stores and go for online shopping. The huge Indian population is set to take the ecommerce and logistics business to almost USD 200 billion by 2026 from USD 38.5 billion some three years back.

The Indian electronic components market also holds great promise and would grow exponentially due to the lower cost of manufacturing, rising local demand, and rapidly developing electronic-based allied industries.

Increasing ‘work from home’ norms increased IT spending in India that is set to grow at a six percent CAGR touching USD 81.9 billion marks in 2021. The social restriction has accelerated the adoption of digital technologies across segments and enhanced IT infrastructure spending.

India drew the highest ever FDI in the first five months of this financial year, from April-August 2020, totaling US$35.73 billion.

How Can I Start a Business in India, If I am in Canada
Three decades have passed since India opened its market for foreign investors and allowed Foreign Direct Investment (FDI) and foreigners can now invest in the majority of Indian business sectors and the country provides a range of incentives encourage company formation in India.

Key Considerations

When a Candian citizen wants to start a business in India, the following considerations are to be kept in mind

  1. Understanding the Indian market regarding the Indian Economic environment, Canada India trade and investment and resources for Canadian investors.
  2. Opportunities for Canadian investors in various sectors including automotive, telecommunication, oil and gas, transportation, medical devices and healthcare, environmental technologies, food processing etc.
  3. Preliminary assessment of readiness through research and identification of target markets, business plan preparation and market entry and, export strategy
  4. Understanding import regulations and licensing
  5. Investment analysis about investment procedures, types of company formation, taxation, labour force and exchange control
  6. Finances and financing including India’s financial systems, import and export financing, types and sources of financial assistance
  7. Legal aspects encompassing such as labour laws, intellectual property protection, litigation and arbitration, standards and conformity, performance guarantees and contractual obligations
  8. Risk management analysis including political risks, foreign exchange risks, customer risks, corruption etc.

Key Company Types

Three types of company formation are possible in India

  1. Public Company needing 7 or more persons
  2. Private Company needing 2 or more persons
  3. One Person Company, basically a private company owned by a single person

The foreign investments in India are governed by the rules and policies of FDI, FEMA, RBI and Companies Act 2013. To establish its business any foreign entity has the following options:

  • Joint Venture with an Indian Company
  • Liaison Office
  • Limited Liability Partnerships (LLPs)
  • Wholly owned subsidiary company
  • Branch Office
Indian Companies act 2013 details how to register private limited company in India, the most popular form of a company allowing 100 per cent FDI through automatic route in the recent reforms and made things easier for Canadian citizens to develop their business in India.

Key Documentation Requirements

Following documents are required for setting up a private limited company in India

  • Photographs of shareholders and Directors
  • Pan card
  • Rent agreement
  • List of Directors and shareholders
  • Authorized representative
  • NOC from the owner of registered office space
  • Address proof
  • Business address proof
  • Constitutional documents; AoA, MoA
  • Identity Proof; Passport, Driving license
  • Prior registrations, if any

Key Process Steps

The company registration is done in 5 easy steps and can be done without being physically present in India
  • Application for Digital Signature Certificate usually takes a day
  • Application for a company name; availability and reservation, generally takes 3 days
  • Drafting of AoA, MoA and preparation of documents, stamp duty payment and documents notarization, takes 2 days normally
  • Application for company registration, application for DIN allotment, PAN and TAN, takes 2 days
  • Application processing by Authority, issuance of the certificate of incorporation, also takes 2 days
Key Online Resources

Following are some resources that can provide additional insights to Canadian citizens for a good start of their Indian businesses

Bottom line

Canada and India share the similar legal heritage of English common law, and in some respects, the two legal systems are almost identical. This facilitates acclimatization of a Canadian citizen with Indian corporate laws and in turn the business environment.

International trade being inherently more complex than domestic trade, retaining a legal, experienced and qualified professional services company who is familiar with the laws and procedures and possess expert knowledge of the target market, is extremely important for company setup in India.

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