Foreign-Owned Indian Company Setup

Under the automatic route (most sectors), no approval is needed — just reporting. Under the government route, prior approval comes from the Government, not RBI: the proposal is filed on the Foreign Investment Facilitation Portal and decided by the administrative ministry or department concerned.

Foreign Currency-Gross Provisional Return. Filed on RBI’s FIRMS portal within 30 days of issuing the shares to the foreign investor. Reports the FDI amount, share price, investor details.

15–30 days for the Indian company. Bank account opening can take an additional 1–2 weeks. Shares must be allotted within 60 days of receiving the money, and FC-GPR filed within 30 days of allotment.

Yes. Dividends are freely repatriable once declared. Dividend distribution tax was abolished from 1 April 2020, so the dividend is taxed in the foreign parent’s hands: the Indian company withholds tax at the rate under the Income-tax Act or the lower rate in the applicable DTAA, if the parent furnishes a tax residency certificate and the other DTAA documents.