Indian Subsidiary

Here is a detailed guide on the registration of subsidiaries in India.


Establishing an Indian subsidiary is a strategic move for foreign companies seeking to expand their presence in the Indian market. In this guide, we will navigate through the process of Indian subsidiary registration, explore its advantages and disadvantages, discuss the need for registration, outline required documentation, and address frequently asked questions to assist foreign businesses in setting up a successful subsidiary in India.

Indian Subsidiary Registration Process

1. Need for Registration:

Registering an Indian subsidiary provides a foreign company with a legal entity in India, allowing it to conduct business, enter contracts, and comply with local regulations. It offers a structured way to navigate the complexities of the Indian market.

2. Advantages of Indian Subsidiary:

a. Limited Liability:

The liability of the parent company is limited to its investment in the subsidiary.

b. Local Market Presence:

Establishing a physical presence enhances credibility and customer trust.

c. Operational Independence:

The subsidiary operates independently, making local decision-making more efficient.

d. Tax Benefits:

Can avail tax benefits under Indian tax laws.

3. Disadvantages of Indian Subsidiary:

a. Initial Setup Costs:

Establishing a subsidiary involves initial setup costs and ongoing compliance expenses.

b. Complexity in Management:

Operating in a foreign jurisdiction may present management challenges.

c. Compliance Requirements:

Must adhere to local regulations, which may be different from the parent company's home country.

d. Repatriation of Profits:

Restrictions may apply to repatriating profits back to the parent company.

In many sectors, foreign companies are allowed to own 100% of the shares, subject to specific conditions.

There is no specific minimum capital requirement for an Indian subsidiary.

No, it is not mandatory to have a local director, but it is advisable for efficient local management.

Documents required:

For registration of subsidiaries in India, the following documents are required:

  • Certificate of Incorporation of Parent Company: Proof of the parent company's registration in its home country.
  • Board Resolution: A resolution from the board of directors authorizing the establishment of the Indian subsidiary.
  • Memorandum of Association (MOA) and Articles of Association (AOA): Draft and file the MOA and AOA, specifying the objectives and regulations of the subsidiary.
  • Director's Passport and Address Proof: Passport copies and address proof for directors of the subsidiary.
  • Registered Office Proof: Document confirming the registered office address in India.
  • Foreign Investment Approvals (if applicable): Obtain necessary approvals from regulatory authorities if foreign investment limits are applicable.

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