From entry decision to commercial production in ten steps
Sequence matters for a manufacturer. Central and state incentives depend on when investment starts and when applications are filed, so scheme applications come before capital is committed. Incorporation of the Indian company (set out further down) runs alongside the first steps.
- Check the FDI route and ownership chain. Confirm the automatic route applies. If a land-border-country owner holds more than 10% or any control, seek approval; stakes of up to 49% in Indian-controlled companies in priority sectors have a 60-day decision target. Who: DPIIT (60-day target). See FDI rules.
- Confirm licensing and product standards. Products outside the industrial licensing list need only an IEM; defence items and arms need a licence. Check whether a BIS Quality Control Order covers the product. Who: DPIIT (NSWS); BIS.
- Select the state and incentive policy. Compare policies by zone and project category. Under Uttar Pradesh’s 2022 policy, at least 80% of capital investment must be made after the policy’s effective date to count. Who: state investment agency. See state incentives.
- Apply for central schemes before capex. Semicon 2.0 (notified 31 August 2026) takes applications for an initial three years. ECMS now takes only supply-chain and capital-equipment applications, to April 2027. File before committing capital. Who: MeitY; India Semiconductor Mission. See central incentives.
- Secure land and building approvals. Take land from a state industrial corporation or an NICDP industrial node, then obtain building plan approval. Who: state industrial corporation; local body.
- Obtain Consent to Establish. Apply to the State Pollution Control Board before construction, with hazardous-waste authorisation where relevant. Who: State Pollution Control Board.
- Register for trade and bonded operations. Obtain an Importer-Exporter Code. For duty-deferred imports into a bonded unit, obtain a warehouse licence (s.58) and manufacturing permission (s.65) under the Customs Act. Who: DGFT; Customs (CBIC). See tax and zones.
- Build, connect power and hire. Arrange construction power and the permanent connection. Employment Linked Incentive support applies to jobs created up to 31 July 2027. Who: state discom.
- Obtain pre-production clearances. Consent to Operate, the factory licence under the Occupational Safety, Health and Working Conditions Code 2020, and BIS certification where a QCO applies. Who: SPCB; factories department; BIS.
- Start production and file claims. File IEM Part B on NSWS and begin incentive claims. Gujarat pays its ECMS top-up annually in proportion to central disbursal. Who: DPIIT; MeitY; state agency.
Sources: Vistra and Legal500 on Press Note 2 (2026); PIB (IEM on NSWS; ECMS, 26 Apr 2025; ELI; Labour Codes); ISM, Semicon 2.0; UP IIEPP 2022; Gujarat ECM Policy 2025; Mumbai Customs MOOWR note.
Before claims are made
The roadmap and the watch-outs carry several conditions that must be in place before an incentive claim is filed or capital is spent:
- File the central scheme application (Semicon 2.0 or the ECMS supply-chain and capital-equipment window) before committing capital.
- In Uttar Pradesh, make at least 80% of capital investment after the policy’s effective date, and for a phased project apply before the first phase starts commercial operations.
- Settle any land-border ownership approval before the investment; above 10%, or with any control, the automatic route does not apply.
- Hold BIS certification before selling any product covered by a Quality Control Order.
- Have the s.58 warehouse licence and s.65 permission in place before importing on a duty-deferred basis.
- Plan working capital on the basis that ECMS incentives are paid over the scheme tenure (FY2025-26 to FY2031-32) after claims are verified, not upfront.
Entry vehicles
Most investors use a private limited subsidiary; offices serve narrow aims. A company or LLP is an Indian resident entity. Branch, liaison and project offices are extensions of the foreign parent, opened through an authorised dealer bank under RBI rules. The generic page is entry vehicles.
| Vehicle | What it may do | Approval needed | Suits |
|---|---|---|---|
| Wholly owned subsidiary (private limited company) | Any lawful business within its objects and the FDI policy. At least 2 shareholders (up to 200) and 2 directors, one meeting the 182-day residence test. | None on the automatic route without a land-border owner; else government route. Incorporated with the Registrar through SPICe+. | Operating businesses that want full control and limited liability. |
| Joint venture company | As a subsidiary, with an Indian partner; caps and conditions apply to the total foreign stake. | As for the sector. Land-border investors taking up to 49% in a fast-track sector, where resident Indians keep majority ownership and control, have a 60-day decision target. | Capped sectors, or where a partner brings licences, land or customers. |
| Limited liability partnership (LLP) | Business with partnership-style governance and limited liability; at least 2 designated partners, one resident. LLP agreement filed within 30 days. | Automatic route only in sectors fully open under the automatic route with no FDI-linked performance conditions. | Service businesses in fully open sectors. |
| Branch office | Activities RBI permits for branches, such as export and import, consultancy and research on behalf of the parent. | Authorised dealer bank; parent needs a sound financial track record. RBI approval in specified cases, such as defence or telecom. | Serving Indian clients directly without a subsidiary. |
| Liaison office | Represents the parent in India; may not carry on business. Valid generally for three years. | Authorised dealer bank, with the same track-record test and RBI referral cases as a branch. | Market study and relationship building before committing capital. |
| Project office | Executes a specific contract in India; valid for the tenure of the project. | Authorised dealer bank under RBI’s project office rules. | Contractors delivering a defined Indian project. |
| No entity yet: distributor or employer of record | Sell through an Indian distributor or importer; engage staff through a third-party employer of record. | None for the foreign company itself. | Testing demand; review tax and contract exposure first. |
Sources: Invest India, Doing Business in India 2025-26 and Legal and Regulatory Framework (Dec 2025); RBI Master Direction on branch, liaison and project offices; DPIIT SOP, 4 May 2026.
For a manufacturer, the plant, its land, its state consents and its incentive claims sit in the Indian entity, which in practice means a subsidiary or a joint venture company. A joint venture company suits capped sectors such as defence (automatic up to 74%), or a project where an Indian partner brings licences, land or customers; it is also the shape the 60-day target assumes for a land-border stake of up to 49% in an Indian-controlled company. Branch offices need RBI approval in specified cases such as defence.
Incorporation: ten steps for a foreign-owned company
The sequence for a private limited subsidiary in an automatic-route sector. Times are shown only where a rule fixes them; state registrations depend on location and activity. The generic page is incorporation.
- Prepare and apostille parent documents. Constitutional documents, board resolution and identity papers of foreign subscribers and directors are notarised and apostilled or legalised. Who: parent company; notary; apostille authority.
- Obtain digital signatures and DINs. A digital signature certificate for at least one proposed director. Director identification numbers are applied for within the SPICe+ form. Who: certifying authority; MCA (SPICe+).
- Reserve the company name. Check the name against existing companies and registered trademarks, then reserve it through RUN or within SPICe+. Who: MCA (RUN or SPICe+).
- File SPICe+ with the MoA, AoA and AGILE. One integrated filing covers incorporation, DINs, PAN and TAN. The linked AGILE form can also obtain GST, EPFO and ESIC registrations. Foreign subscribers attach a signed physical MoA and AoA. Who: MCA Central Registration Centre.
- Receive the certificate of incorporation. The Central Registration Centre scrutinises the documents and may ask for changes. The CIN, PAN and TAN are allotted on incorporation. Who: Registrar of Companies (CRC).
- Open a bank account and bring in capital. Receive share capital through an authorised dealer bank and allot shares within 60 days of receipt, priced at not less than fair value. Who: authorised dealer bank; board. Within 60 days.
- Report the share issue (FC-GPR). File Form FC-GPR for shares issued to the foreign parent that count as FDI. Who: RBI FIRMS portal. Within 30 days of issue.
- Declare commencement of business. Declare receipt of the subscription money and verify the registered office before starting business. Who: MCA. Within 180 days.
- Register for GST and obtain an IEC. If not done through AGILE, apply for GST; low-risk applicants can opt for automated registration within three working days. Importers and exporters also need an Importer-Exporter Code. Who: GST portal (3 working days); DGFT.
- First board meeting; staff registrations. Appoint the first auditor and open statutory registers. Obtain shops and establishments, professional tax, EPFO and ESIC registrations as applicable. Who: board; state labour department; EPFO; ESIC.
Sources: Invest India, Doing Business in India 2025-26; RBI FEMA 395 Regulations; RBI Master Direction, Jun 2026; Tribune/ANI and KPMG on GST registration (secondary).
The IEC obtained at incorporation step 9 serves roadmap step 7, and EPFO registration at step 10 is a condition of the Employment Linked Incentive at roadmap step 8.
What to check next
- Map the ownership chain for land-border beneficial owners before choosing the route or filing on the FIF/NSWS portal.
- Confirm the scheme window for your product and file the central application before placing equipment orders or signing construction contracts.
- Check the investment-date and phasing rules of the state policy you choose before spending.
- Decide on MOOWR before importing capital goods, so the s.58 licence and s.65 permission are in place.
- Put the FC-GPR (30 days), share allotment (60 days) and commencement (180 days) deadlines in the company calendar from incorporation.