Access to capital is a major challenge for companies, especially those in the micro, small, and medium enterprises sector. If a company really wants to widen its footprint, the traditional sources of finance like bank loans and lines of credit may not suffice. A business with a good bottom line, in such a scenario, may look at attracting overseas investment to fulfill its ambitions. This source is known as Foreign Direct Investment (FDI). In this, a foreign company takes a stake in a local company by investing money, skills, and technology in it. This investment does not just benefit the company but the economy as well. It works as a vote of confidence on the company’s operations as well as the country it does business in.
The percentage of stake that can be owned by a foreign company is regulated and also depends on the sector it operates in. Further, the investment can be made via the automatic route or the approval route. In the former, the local business does not need a regulatory nod and the foreign company can take ownership up to a stipulated percentage automatically. In the latter, the local company needs approval from the government before the foreign company can buy stake either because of it being a sensitive sector or beyond the stipulated percentage.
Several Indian companies, including startups, have experienced tremendous success in expanding via FDI with foreign companies lining up to make an investment. With many local businesses proving themselves at the global stage, this route has become an attractive one to explore. Your business may be next in line to get the boost via FDI.
However, regardless of whether your company qualifies for automatic or approval route, there is a lot of regulatory compliance activities to be done and reporting to file. For this, your business needs a reliable outsourcing partner who can ensure that there are no slip-ups in the process. Boston Financial Advisory Group is such a partner.
They employ a team of compliance experts and chartered accountants who are proficient in the field of regulatory compliance and reporting while considering FDI. Partnering with them can save your business the cost of hiring a dedicated team for this function. Given the adeptness of the team, the process of compliance will become hassle free for your business. Their solutions are tech-oriented which will ensure that your reporting is accurate and on time.
With Boston Financial Advisory Group taking charge of your FDI compliance and reporting, you can focus on deepening the partnership with foreign companies and expanding your business.
BFAG (Boston Financial Advisory Group) provides the best accounting and financial services. We have a team of experienced professionals who can help you in maintaining your books of accounts.
So, get in touch with us to avail our services.
Contact us in case of any assistance or queries.
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Visit our website: www.bostonfagroup.com