Liaison, Branch or Subsidiary: Choosing Your India Entry Structure

Foreign companies entering India typically choose between three structures — a liaison office, a branch office, or a subsidiary. The right choice depends on whether you want to test the market, execute specific projects, or build a full operating business.

Liaison Office

A liaison (representative) office is the lightest footprint. It can promote the parent, gather market intelligence, and act as a communication channel — but it cannot earn income in India and is funded entirely by inward remittances. It needs RBI approval and suits early-stage market exploration.

Branch Office

A branch can undertake specified commercial activities — export/import, consultancy, and executing contracts — and can earn income. It is an extension of the parent (so liability flows back), requires RBI approval, and is taxed at higher foreign-company rates.

Subsidiary (Private Limited Company)

A wholly owned subsidiary is a separate Indian company. It offers the most flexibility — full commercial operations, limited liability, easier repatriation, and taxation at domestic company rates. Most serious market entrants choose this route.

Quick Comparison

• Can earn income? Liaison: No · Branch: Yes · Subsidiary: Yes.
• Liability: Liaison/Branch flow to parent · Subsidiary is ring-fenced.
• Approval: Liaison/Branch need RBI approval · Subsidiary uses the FDI route.
• Best for: Liaison — market research · Branch — projects/exports · Subsidiary — full operations.

Statura advises foreign investors on the right structure and handles subsidiary setup, liaison office, and FDI/FEMA compliance.