A foreign national can incorporate a company in India and subscribe the equity shares of that company but under the foreign Investment Policy of India, such investments are categorized under two routes:

• Automatic Route:

 Under the Automatic Route, the Government of India has prescribed the limit of foreign investment in various sectors and if you are incorporating a company to operate in that sector and within the limits of foreign investment allowed in that sector, you can establish your company in India

In case their investment falls under the automatic route, a company can be incorporated without any permission

Use our “Check FDI Limit” service to check whether your business fall in the automatic route or not

• Approval Route

If you do not fall under the above route or you are making investment in sector more that limit of foreign investment available in that sector, than you will be required to take the permission of Foreign Investment Promotion Board for incorporating a company in India

In case their investment falls under approval route, they have to take the permission of relevant regulatory authority before incorporating a company.

To know more, check out India Investment Guide