India entry from Japan — for Japanese companies and founders

Last reviewed: November 2026 · Written and reviewed by CA Regi Tom Antony, FCA

How big is Japanese investment in India?

The Embassy of India in Tokyo reports Japan as the fifth-largest source of foreign direct investment into India, with about USD 45 billion of cumulative investment between April 2000 and June 2025. About 1,434 Japanese companies run around 5,200 business establishments in India, roughly half in manufacturing. The India-Japan Comprehensive Economic Partnership Agreement has been in force since 1 August 2011, and in August 2025 the two governments set a target of 10 trillion yen of Japanese private investment in India over the following decade.

Which Japanese companies operate in India?

Examples are publicly known businesses, listed for context only; they are not our clients.

Which structure should a Japanese company use?

Most Japanese businesses choose a wholly owned subsidiary, which can hire, invoice and hold contracts in India. A liaison office suits market research and representation before committing, a project office suits a specific contract, and a joint venture suits a partnership with an Indian group, a common pattern in Japanese automotive and industrial entries. To buy an existing business, see acquiring an Indian company. Compare all options in subsidiary vs branch vs liaison vs project office.

How does a Japanese company set up in India?

1. 1

   Confirm sector and vehicle

   Check the FDI cap and route, and choose a wholly owned subsidiary, joint venture, or branch, liaison or project office.

2. 2

   Prepare and apostille Japanese documents

   Notarise and apostille the certificate of registered matters, board resolution and director identity documents through the Ministry of Foreign Affairs of Japan, with certified English translations.

3. 3

   Incorporate through SPICe+

   Reserve the name and incorporate with DINs, PAN and TAN in one MCA filing, appointing at least one resident director.

4. 4

   Fund and report

   Remit share capital through banking channels, issue shares within 60 days and file FC-GPR within 30 days of allotment; file the FLA return by 15 July each year.

5. 5

   Set intra-group pricing

   Price services, royalties and supplies between the Japanese parent and the Indian company at arm's length under sections 161 to 173 of the Income-tax Act, 2025 (formerly sections 92 to 92F of the 1961 Act).

What are the India-Japan DTAA rates?

Treaty rates apply to an eligible Japanese-resident beneficial owner that gives the Indian payer a Japanese tax residency certificate and Form 41 (formerly Form 10F), subject to the treaty's conditions and anti-abuse rules. The Indian company withholds under section 393 of the Income-tax Act, 2025 (formerly section 195 of the 1961 Act) and files Form 145 (formerly Form 15CA), with Form 146 (formerly Form 15CB) where required. See profit repatriation from India and withholding tax on foreign remittances.

Raise with your Japanese tax accountant (zeirishi), high level only: Japan's foreign dividend exclusion, the Japanese CFC rules (tax haven countermeasure taxation), Japanese transfer pricing documentation, and foreign tax credit for Indian withholding. This page does not give Japanese tax advice.

What support is there for Japanese investors?

Japan Plus, set up in October 2014 within Invest India and DPIIT, is a facilitation desk for Japanese companies. Several states also have Japan desks and Japan Industrial Townships with ready infrastructure. See best locations for foreign companies in India and the sector guide for manufacturing and PLI.

What compliance follows after entry?

After incorporation, the Indian company registers for GST and other post-incorporation registrations, files the FLA return by 15 July, holds its statutory audit, files ROC returns, and prepares a transfer pricing report in Form 48 (formerly Form 3CEB). See the annual compliance calendar and trademark registration for foreign companies.

Sources: Embassy of India, Tokyo (India-Japan commercial relations); Income Tax Department treaty rate chart; FEMA (Non-debt Instruments) Rules, 2019; Companies Act, 2013, section 149(3); Income-tax Act, 2025, sections 161 to 173 and 393. Last reviewed: November 2026 · Reviewed by CA Regi Tom Antony, Regi Tom Antony & Associates. General guidance, not tax or legal advice on your facts; coordinate Japanese tax with your Japanese tax accountant.