Chartered Accountants◆Practising since 2016

China to India · Structure

Choosing an Indian entity for a Chinese parent

CA Utsav Dogra, Chartered Accountant, ICAI M. No. 542375 · Updated

In brief

A private limited subsidiary suits almost every Chinese business that will hire, sell or contract in India. A branch or liaison office needs approval through an authorised dealer bank and only suits a defined role; an LLP is limited to sectors open to 100% foreign investment under the automatic route.

What is specific to Chinese companies

Joint ventures with Indian majority control are common, partly because approval is more readily granted. Holding through Hong Kong, Singapore or another country does not avoid Press Note 3 where the beneficial owner is Chinese.

Joint ventures with Indian partners are common because approval is easier to obtain where the Indian side holds control.

How the Chinese side affects the choice

China taxes foreign dividends with credit for Indian tax under its own rules.

Our services

How SU and Company helps

We compare the options against the Chinese parent's plans and give a written recommendation before any filing.

  • Activity and FDI route check
  • Tax comparison of subsidiary and branch
  • Eligibility check for branch or liaison office approval
  • Joint venture shareholding and FEMA pricing points

Questions

Is a branch office a good option for a Chinese company?

Only for a narrow, approved activity. A branch is taxed at the foreign company rate and exposes the parent directly, so most groups prefer a subsidiary.

General information as at 5 November 2026, not advice for a particular case. Indian and Chinese rules change often; confirm the current position before acting. Chinese law points should be confirmed with a Chinese adviser.

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