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AHLAWAT & ASSOCIATES ADVOCATES
Typical Problems Faced By NRIs While Starting A Business In India?
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• As India's economy is booming by leaps and bounds, many NRIs business tycoons explore opportunities to invest their hard-earned money In India, set up business ventures, provide jobs to fellow Indians, and get a handsome profit out of it. • But, for NRIs, setting up companies is not an easy task. There are many problems that discourage them from investing money in India. Here few problems are mentioned. Just cast a look at them-
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1. Excessive Bureaucracy • Bureaucracy is a system in which chosen officers follow rigid rules and regulations (as dictated by the government) and give their nod to various projects related to different fields, such as business, construction, administrative decisions, etc. • When NRIs start the official procedure of launching their businesses in India, self-serving bureaucrats delay their projects and don't give the required approval easily. • They tend to move NRIs from one department to another in the name of different formalities. It creates stampedes the creativity of NRIs, and they abandon their idea of doing business in India.
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2. Large scale Corruption • Corruption is rampant in many government departments in India. It is a mind-blowing challenge for NRIs who want to set up business in India. It is also rampant in the private sector, making it difficult for new business organizations to set their business organization in India. • For example- Many Indians banks don't release funds even though they approve the loan application. There are some corrupt officers in banks who raise an unwarranted objection to halt the release of funds.
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3. No Clear Rights To NRIs • In India, there is no clarity on the legal rights of NRIs. For example- if NRIs try to buy home/office for the launch of their business organizations, locals cheat them by selling farmland and agricultural land unlawfully. • To solve this problem, NRI investors must deal with certified real estate brokers only in consultation with any startup lawyers in India. This will help NRIs to deal with the rules of the Foreign Exchange Management Act (FEMA).
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4. Forceful Land Grabbing Problem • Forceful and illegal land grabbing is another problem faced by NRIs in India. In most of the cases, the land grabber and person taking illegal possession of the land of NRIs are known to the buyer. • So, to avoid this hassle NRIs must engage in land dealings in consultation with the real estate broker, local family members or a reputed law firm in India.
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5. Requirement Of Indian Residents • Companies Act, 2013 allow NRIs, foreign nationals, and PIOs to act as directors in an Indian company. However, this creates a lot of problems for many individuals as they must Indian nationals. • However, there are many Indian companies that help NRIs to find willing persons as directors in exchange for a fixed remuneration. Even Corporate Law firms in India can help them find such persons through referrals and other relevant sources.
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Final Words:
These are some main problems faced by NRIs in India when they come here with a business point of view. However, the best law firms in India can help them to get rid of all these issues easily and start their business activities in this country.
AHLAWAT & ASSOCIATES ADVOCATES
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