Foreign Exchange Transactions (Inbound & Outbound)
India is the fastest growing economy with population of English speaking and young people which has made it the best destination for foreign investment with best returns. India is making things digital for transparency and urged investors to invest in infrastructure, MSMEs, banks, NBFCs and other areas. Technology and globalization of business has brought people close and it has resulted in movements of financial inflows and outflows in the form of foreign exchange. India’s youth is one of its most promising economic features, Census Data indicates that about 41% of our population is under 20. India is now the world’s second largest internet market and by year 2021, almost 60% of Indian population will be Online.
India has also improved its ranking in Ease of Doing Business in past few years which has attracted many Investors to set up their business in India. The Reserve Bank of India (RBI) has also allowed FDI in almost all the sectors under automatic route except some sectors where prior approval is required.
On the other hand while Indian businessmen seek foreign pastures to conduct their business, there is also a flow of foreign exchange out of India to invest in foreign markets, which is ODI. RBI allows ODI upto 4 times the net worth of the entity to invest overseas.
Expert advice is required for facilitating Investments into India (Foreign Direct Investment -FDI) and Indian Investments abroad (Overseas Direct Investment-ODI) by adhering to legal compliances.
Both FDI and ODI are liberally allowed however it requires approvals from sector specific Ministries, Reserve Bank of India under Foreign Exchange Management Act, 1999 (FEMA) and guidelines for External Commercial Borrowings (ECBs).
Our Expert Services includes:
- Advising on legal and procedural matters under FDI, ODI and External Commercial Borrowings (ECB)
- Preparing, filing and obtaining necessary approvals from respective Administrative Ministry/Department approval and Reserve Bank of India for inflow and outflow of funds
- Formation of Wholly Owned Subsidiary in India or overseas
- Preparing project reports and obtaining approvals from the Reserve Bank of India for setting up Branch Office/Liaison Office/Project Office by overseas company
- Issuing certification to RBI as Professional for any allotment of shares by Indian Company, transfer of shares from Resident entity to Non Resident entity, Monthly ECB-2 returns and other due diligence certificate
- Filing forms online on the Portal of FIRMS or FLAIR for the company
- Advising on GDR issue and listing of it at overseas Stock Exchanges
- Compounding for violations under ForEx laws