Doing Business in India - RSM Austria

Foreword
The Indian economy grew by about 7.2% p.a. during 2009-10 despite the challenges on
account of slowdown faced by the global economies in the later part of 2008-09. The overall
growth of the economy can directly be attributed to its strong fundamentals, renewed
momentum in the manufacturing sector, infrastructure sector and growing contribution of
the service sector. Increased emphasis has been laid by the policy makers on further
integration of the economy with the global markets by laying a road map for implementation
of the Goods and Services Tax (GST) and convergence of the financial reporting standards
with International Financial Reporting Standards (IFRS).
The Indian Government plans to implement the Direct Taxes Code (DTC) from the fiscal year
2012-13 i.e. 1 April 2012. The basic purpose of the Direct Tax Code is to completely overhaul the
complexities of the existing Income Tax Act, 1961 and to make the tax structure simple and
also to provide a fair ground for collection and levy of taxes which would be light not only on
the individual tax payers, but also corporate houses and also foreign residents.
India is fast becoming the “outsourcing destination of choice” of the world in sectors such as
Information Technology, Pharmaceuticals, Banking and Finance, Insurance, Gem and
Jewellery, Manufacturing etc. This is mainly due to the ample availability of competent and
cost efficient workforce whereby setting up operations in India has become synonymous to
efficient and cost effective operations. The growing Indian middle class population has
placed India as “The market of the future”. As a result of these factors, many of the leading
companies all over the world have already set up operations in India or are planning to do so.
We have compiled this guide to provide an overview of various social, legal, tax and
commercial aspects in India, which can have a material impact on decision about doing
business in India.
Given the limitations in compiling a booklet of this size, our intention is to offer a broad
outline of the areas we feel are relevant to undertake business activities in India.
This guide cannot serve as a substitute for specific legal, tax or accounting advice concerning
a business undertaking in India. Therefore, when specific issues occur in practice, it will be
necessary to refer to the specific laws and regulations. RSM International or RSM Astute
Consulting Private Limited are not responsible for any action taken based on information
contained in this guide and any liability arising from any statements or error contained in it.
RSM Astute Consulting Private Limited along with its associates is the only Indian member of
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RSM International. RSM International is the world's 6 largest network of accounting and
consulting firms, with annual revenue exceeding US$ 3.87 billion and offices in more than 76
countries and can be contacted through any of RSM International's associated member firms
around the world.
Compiled by:
RSM Astute Consulting Private Limited.
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13 Floor, Bakhtawar,
229, Nariman Point, Mumbai - 400 021.
Tel: (91-22) 6121 4444/6696 0644 Fax: (91-22) 2820 5685
Email: emails@astuteconsulting.com
Url: www.astuteconsulting.com
DOING BUSINESS IN INDIA