Joint Venture

A foreign company can invest in an Indian company through a joint venture agreement in the areas which are otherwise not reserved exclusively for the public sector or which are not under the prohibited categories. Carrying out of operations through a joint venture with an Indian partner may provide the following advantages to a foreign investor :

  • Already established distribution / marketing set up of the Indian partner;
  • Available financial resources of the Indian partner;
  • Already established contacts of the Indian partner that help ease the process of setting up operations.

Drafting of joint venture agreement (JVA) is of key importance as it lays down the terms and conditions and the governing powers of the JV partners inter-se. The foreign company can enter into JV by forming a company or any other forms of entity like LLP.

Pre Joint Venture Exercise