Imagine having access to the world's largest pool of digital talent, a booming economy hungry for innovation, and government policies designed to welcome global enterprises. That's the promise of India — but only for those who build on the right foundation. Before a company can tap into this trillion-dollar opportunity, it must first master the art of creating a compliant and future-ready legal entity.
Establishing a legal entity in India is the foundational step for any foreign enterprise setting up operations in the country. For global companies planning to launch Global Capability Centers (GCCs), navigating the intricate landscape of registrations and government approvals can make or break the success of the setup. India's regulatory environment, though well-structured and investment-friendly, requires precise compliance with multiple authorities to ensure seamless entry and sustained operations.
Below, we outline the 10 essential government approvals and registrations every GCC must secure to establish a compliant and future-ready legal entity in India.
The journey begins with incorporating your legal entity under the Companies Act, 2013, administered by the Ministry of Corporate Affairs (MCA). Typically, foreign investors opt for a Wholly Owned Subsidiary (WOS) or a Limited Liability Partnership (LLP) structure.
The process includes obtaining:
This registration forms the backbone of your legal entity, enabling it to open a bank account, hire talent, and enter into commercial contracts.
Foreign direct investments (FDI) in India are regulated by the Foreign Exchange Management Act (FEMA), overseen by the Reserve Bank of India. When a foreign enterprise sets up a legal entity in India, it must file the Foreign Investment Reporting within 30 days of share allotment via the FIRMS Portal.
This ensures the inflow of capital into your Indian operations remains fully compliant with RBI norms — a crucial requirement for any global corporation establishing a GCC or innovation-driven subsidiary.
A newly incorporated legal entity must obtain a PAN and TAN from the Income Tax Department.
Without these identifiers, your legal entity cannot operate legally or remit payments within India.
India's unified tax regime mandates that any legal entity engaging in supply of goods or services exceeding ₹20 lakh annual turnover must register for GST.
This registration:
For Global Capability Centers dealing in tech services, consulting, or back-office operations, GST compliance is vital for seamless financial transactions and audit readiness.
Even if your legal entity is primarily a service center, it may require an Import Export Code (IEC) to facilitate global procurement of software tools, hardware imports, or data hosting contracts. Issued by the Directorate General of Foreign Trade (DGFT), the IEC is mandatory for any cross-border financial transaction related to trade.
This registration future-proofs your legal entity, ensuring it can function as a self-sufficient GCC hub connected to the global ecosystem.
Every physical office of a legal entity—from a co-working space to a large Centre of Excellence—must be registered under the Shops and Establishments Act of the respective state.
This registration governs:
It's an essential step for demonstrating labor law compliance and ensuring smooth HR operations for your legal entity functioning as a talent hub in India.
Employment-related compliance is a major component of running a legal entity in India. Two key registrations stand out:
Both ensure your legal entity remains aligned with India's labor welfare standards while maintaining a compliant employer brand.
Once your legal entity employs 20 or more people, registration with the Employees' Provident Fund Organisation (EPFO) becomes mandatory. This not only ensures retirement benefits and employee savings but also boosts credibility as a responsible employer.
For a global corporation aiming to attract and retain top talent, PF compliance strengthens the overall governance framework and makes your GCC a preferred workplace in India's competitive GCC solutions landscape.
Depending on your sector, your legal entity may require specific licenses:
These approvals ensure that your legal entity aligns with both national and local operational norms, especially if your GCC is positioned as a Centre of Excellence for product development or digital transformation.
For forward-looking enterprises creating an innovation hub, registering under the Startup India initiative or with the Department for Promotion of Industry and Internal Trade (DPIIT) can unlock government incentives, tax holidays, and simplified compliance procedures.
This step isn't mandatory but highly recommended for legal entities focused on R&D, digital transformation, or AI-driven tech services. Such recognition positions your GCC as a catalyst for innovation and gives your organization a competitive edge in India's thriving technology landscape.
Setting up a legal entity in India involves more than paperwork—it's about establishing a compliant, scalable foundation for long-term success. Each registration connects to a broader operational framework:
When orchestrated together, these approvals transform your legal entity into a compliant, efficient, and future-ready business vehicle.
For Global Capability Centers, compliance is not just a regulatory obligation—it's a strategic enabler. A fully compliant legal entity gains:
According to KPMG in India, the country now hosts over 1,700 Global Capability Centers (GCCs) employing 1.9 million professionals, with the number projected to reach 2,400 by 2030. This accelerating growth underscores why robust regulatory compliance is critical—not only to maintain operational stability but also to attract investors, talent, and innovation partners in India's expanding GCC ecosystem.
India has become the global destination for GCC solutions—from IT development and analytics to product design and AI innovation. According to Deloitte, India already hosts over 1,800 Global Capability Centers (GCCs), and this number is projected to rise to between 2,400 and 5,000 by 2030, with the industry's contribution to India's GDP forecast at US $470‐600 billion by FY '30.
By ensuring legal readiness, enterprises unlock the freedom to focus on core operations: developing products, hiring the best talent, and creating a vibrant innovation hub that mirrors their parent organization's values.
As India transitions into a global GCC hub, well-governed entities enjoy the dual advantage of cost efficiency and strategic agility—qualities that define successful Global Capability Centers.
Establishing a legal entity in India is a complex yet rewarding journey. Each government approval shapes a business that is not just compliant but strategically empowered. From incorporation to tax, labor, and sector-specific registrations, these 10 approvals form the scaffolding for operational success. For any global corporation building a Centre of Excellence or innovation hub, securing them early ensures a smooth and compliant launch.
A well-structured legal entity is more than a statutory requirement—it's the foundation on which world-class GCCs thrive, scale, and innovate. As India strengthens its position as a global talent hub for digital and tech services, your legal groundwork today will define your competitive edge tomorrow.
At Anlage, we simplify this process through comprehensive GCC solutions—from entity setup and compliance to talent, real estate, and managed operations.
Contact us to build a compliant, future-ready legal entity and accelerate your India journey with confidence.
India offers a rare mix of cost efficiency, skilled digital talent, and supportive government policies, making it a preferred destination for establishing Global Capability Centers (GCCs).
Key approvals include registration under the Companies Act, 2013, RBI compliance under FEMA, GST registration, PAN/TAN, and labor law registrations such as ESI and PF.
Yes, most sectors in India allow 100% Foreign Direct Investment (FDI) under the automatic route, enabling full ownership of the legal entity by the parent company.
These registrations offer tax incentives, relaxed compliance norms, and easier access to government grants—especially valuable for GCCs engaged in tech services or R&D.
Anlage provides end-to-end GCC solutions, guiding enterprises through entity setup, compliance, real estate, and talent acquisition to ensure a smooth India entry.
Gaurav Chawla, COO of Anlage Infotech, emphasized the transformative role of AI-powered analytics in HR at the 5th Edition of the GCC Summit 2024. Highlighting predictive analysis and smart tool utilization, he shared how these technologies can cut hiring cycle times by up to 60%, driving greater efficiency. The event took place at GMR Aerocity Hyderabad.
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