Regulatory Regime Forcing COS' 'Externalisation'

DOING BUSINESS AWAY FROM INDIAN TAX OVERSIGHT AND EASE OF FUND-RAISING AMONG REASONS FOR INDIA INC'S TRYST WITH FOREIGN SHORES

With Indian companies rapidly expanding their presence internationally, there has been an increased keenness in companies operating in high growth sectors to migrate their holding company structures from India to reputed offshore jurisdictions. For lack of a better word, let's refer this process of structuring/ restructuring as 'externalisation' as that term may fit the reference better than 'globalisation' or 'internationalisation', both of which have much wider imports.

There are several drivers for externalisation. First, it moves the businesses away from Indian tax and regulatory challenges into jurisdictions that may be more conducive from an operational standpoint and also substantially mitigates tax leakage and regulatory uncertainty. Unwritten prohibition on 'put options', retroactive taxation of indirect transfers,