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What is the difference between a subsidiary, branch office, and liaison office?
The three most common entry strategies for foreign companies in India:
• Private Limited Company (Subsidiary): A fully incorporated company in India. Can do all types of business activities. Can hire anyone. Can sign any type of contract. Can raise funds. Suitable for long-term operations.
• Branch Office: A part of your foreign company. Can only earn income from IT services, consulting services, and export-import activities. Cannot manufacture. Cannot retail trade. Needs RBI permission.
• Liaison Office: Cannot earn income in India. Only for promoting your company. Only for collecting information. Needs RBI permission. Suitable only for market research.
Tip: For 95% of companies wanting real operations in India, a Private Limited Company is the right choice.
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