Project offices are that type of business entities which are incorporated by the foreign companies for as like temporary project or site offices in India. Now a days The Indian Government grants general permission for foreign companies to incorporate project office entity in India.
- Having a full transparency into all aspects of the projects
- Having better control over projects
- Being better equipped to make the optimal decisions related to projects
- Minimizing uncertainty and associated risks
- Increasing support and buy in from all stakeholders
Foreign companies are granted projects in India by Indian entities. General Permission has been granted by Reserve Bank of India vide Notification No. FEMA 95/2003-RB dated July 2, 2003 to foreign companies to open Project Office/s in India provided they have secured from an Indian company, a contract to execute a project in India, and
- the project is funded directly by inward remittance from abroad; or
- the project is funded by a bilateral or multilateral International Financing Agency; or
- the project has been cleared by an appropriate authority; or
- a company or entity in India awarding the contract has been granted Term Loan by a Public Financial Institution or a bank in India for the project.
- However, if the above criteria are not met, or if the parent entity is established in Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran or China, such applications have to be forwarded to Central Office of the Foreign Exchange Department of the Reserve Bank at Mumbai for approval.