Foreign Investors Doing Business in India

(Through Joint Venture Model)

Foreign investors can do business in India by entering into a Joint Venture (JV) with an Indian company or promoter. This model allows investors to participate in India’s growth while ensuring compliance with local laws and market practices.

How We Support Through Joint Venture

• JV Structuring & Advisory
  We assist foreign investors in structuring compliant joint ventures with trusted Indian partners, aligned with FDI policy and sectoral norms.

• Regulatory & Legal Compliance
  All investments are structured in accordance with FEMA, RBI guidelines, and applicable FDI regulations.

• Market Entry & Project Identification
  We help identify suitable projects and business opportunities across permitted sectors, including real estate and construction (subject to regulations).

• Due Diligence & Risk Management
  Comprehensive legal, technical, and financial due diligence is conducted to safeguard investor interests.

• Operational Coordination
  We coordinate with partner entities to ensure smooth execution, governance, and reporting throughout the JV lifecycle.

• Profit Structuring & Repatriation Support
  Assistance is provided for profit distribution and repatriation, subject to tax and regulatory compliance.

The Reserve Bank of India (RBI), under the Foreign Exchange Management Act (FEMA), allows international investors (Non-Resident Indians or NRIs, Overseas Citizens of India or OCIs, and foreign nationals/entities) to invest in the real estate sector in India, primarily in residential and commercial properties. Prior RBI permission is generally not required for most permitted transactions, but strict guidelines apply to the type of property and funding channels.

Permissible Investments

International investors are permitted to invest in the following types of properties:

· Residential property: This includes apartments, houses, and villa plots.

· Commercial property: This includes office spaces, retail outlets, and industrial properties.

· Construction-development projects: Foreign Direct Investment (FDI) of up to 100% is allowed under the automatic route for the development of townships, housing, and commercial premises.

Prohibited Investments: Investors are strictly prohibited from purchasing agricultural land, plantation property, or farmhouses, unless the property is acquired through inheritance from a resident Indian.

Funding and Payment Guidelines

All transactions must be conducted through official banking channels in India.

· Accepted Accounts (for NRIs/OCIs): Payments can be made via funds remitted from abroad through normal banking channels or by debit to a Non-Resident External (NRE), Non-Resident Ordinary (NRO), or Foreign Currency Non-Resident (FCNR) account.

· Prohibited Payment Methods: Payments cannot be made using traveler's cheques, foreign currency notes, or cash.

· Home Loans: NRIs/OCIs can avail home loans from Indian financial institutions, with repayment also routed through NRE/NRO/FCNR accounts or rental income.

Repatriation of Funds.

Repatriation (transfer of funds back to an overseas account) is permitted subject to specific conditions:

· Sale Proceeds (for NRIs/OCIs): The principal amount and capital gains from the sale of residential or commercial property can generally be repatriated. Repatriation of sale proceeds from residential property is limited to two properties.

· Repatriation Limit: A general limit of USD 1 million per financial year applies for repatriation from NRO accounts, which includes rental income and proceeds from properties purchased with rupee funds.

· Documentation: Repatriation requires documentation such as the sale deed, bank statements, and a Tax Clearance/No Objection Certificate (NOC) from the Income Tax Authority, often submitted through an Authorized Dealer (AD) bank.

Other Key Considerations

· Prior Approval: Citizens/entities from certain countries (e.g., Pakistan, Bangladesh, China, Iran, etc.) require prior RBI approval for any immovable property transaction, other than a lease not exceeding five years.

· Taxation: Rental income and capital gains are subject to Indian tax laws, including Tax Deducted at Source (TDS) provisions. Investors can benefit from Double Taxation Avoidance Agreements (DTAAs) if their resident country has one with India.

· Power of Attorney (PoA): Investors who cannot be physically present in India can grant a PoA to a resident Indian relative or trusted representative to manage the transactions, provided the document is legally vetted and registered.

For detailed and official guidance, investors should consult the relevant notifications and Master Directions on the RBI website or seek professional legal and tax advice.