Indian Startups have been registering their companies in Singapore and are choosing their Headquarters in Singapore.
It is a well-known fact that Singapore is a smooth country to start businesses. Being the number one country on the Heritage foundation’s index of Economic freedom, number 1 in the World Economic Forum global competitive report (2019), and positioned at number 2 in the World Bank ease of doing business (2020). Singapore has lower taxes than India for both GST rates and corporate tax with no capital gains tax applied. Their tax treaty relieved Singapore-based companies from paying double tax with regard to international businesses.
Several leading entrepreneurs move to Singapore making the country an investment hub. This has created a network of Indian companies that currently have a huge presence in the market. A report by an Indian briefing suggested that over 8000 Indian firms got themselves registered in Singapore since 2002, many of them did not need to visit Singapore and managed to register themselves online.
Flipkart had its headquarters in Singapore during the initial stages of investment. They decided to register the company in Singapore for faster growth seeing a better opportunity because of the trouble they faced with the Indian government. Stricter policies made it harder to raise funds in their own country. They resorted to making the Indian firms subsidiaries.
In the month of September Finance Minister Nirmala Sitharaman stated that the government is ready to engage with startups to address issues facing the ecosystem. “So, I would think continuous engagement with the startups is what is going to help them to, one, remain and, second, do better within India. But, if there are temptations for which they would want to go outside, we need to understand how much we can entertain and serve on those courses. Not all of them are possible but equally, we can try.”
Ms. Grace Sai, the co-founder of Unravel Carbon, said “The market size of Southeast Asia or Asia alone is big enough to create category-winning companies. So, for some companies, it’s never their strategy to be global.”