Register a Company in India from Maldives

Author: Manu Rao | Updated: March 2026

At a Glance

Why Maldivian Investors Are Setting Up Companies in India

India-Maldives bilateral trade has grown more than threefold over the past eight years. India's exports to the Maldives doubled to USD 680 million in FY 2024-25, while imports from the Maldives surged twenty-fold to USD 119 million. India is the Maldives' second-largest trading partner, supplying essential commodities including petroleum products, pharmaceuticals, rice, fruits, vegetables, machinery, electrical equipment, and transport vehicles. The Maldives exports fish and marine products to India.

India's development partnership with the Maldives is one of the most significant bilateral aid relationships in South Asia. India has extended USD 800 million in Lines of Credit for infrastructure projects across the archipelago. Key projects include the Addu reclamation and shore protection project (USD 80 million), the Addu roads and drainage redevelopment (USD 70 million), the Gan International Airport redevelopment (USD 29 million), and the Hankede Bridge in Addu City (1.4 km, inaugurated February 2025). India is collaborating on 65 community development initiatives across the Maldives, with 12 in Addu alone.

In July 2025, PM Modi visited the Maldives and signed eight bilateral agreements covering a USD 565 million Line of Credit for infrastructure, UPI-RuPay integration, debt relief (40% reduction in annual repayments), fisheries cooperation, housing projects, security assistance, climate resilience, and advancement of FTA and BIT negotiations.

Approximately 27,000-29,000 Indians live and work in the Maldives — the largest expatriate community in the country. Indians comprise nurses, teachers, managers, doctors, engineers, accountants, technicians, masons, tailors, plumbers, and construction workers. About 22,000 live in Male, the capital. People from Kerala and Tamil Nadu have centuries-old trade connections with the Maldives.

The Maldivian economy is driven by tourism (30% of GDP, 60%+ of foreign currency earnings), with 2.04 million tourist arrivals in 2024. India was the largest source market for tourists to the Maldives in recent years. Key investment sectors include tourism and hospitality, fisheries and marine products, construction and infrastructure, renewable energy, healthcare, and telecommunications.

India-Maldives: The Strategic Neighbor Dynamic

The India-Maldives relationship operates differently from typical bilateral investment corridors. The Maldives is India's closest Indian Ocean neighbor, and the strategic dimension of this relationship shapes the investment environment in ways that matter for business structuring.

India and the Maldives have only a Limited Agreement for avoidance of double taxation — it covers income from international air transport only. This agreement was signed on 11 April 2016 and entered into force on 1 August 2016. Under it, profits from operating aircraft in international traffic are taxed only in the country where the enterprise belongs. Beyond aviation, there is no comprehensive DTAA covering dividends, interest, royalties, or capital gains.

India and the Maldives also have a Tax Information Exchange Agreement (TIEA), effective from 2 August 2016, and participate in the SAARC multilateral agreement on mutual administrative assistance in tax matters (effective 1 April 2011). These agreements facilitate information sharing but do not reduce withholding rates.

Critically, the two countries are actively negotiating both a Free Trade Agreement (FTA) and a Bilateral Investment Treaty (BIT). India and Maldives signed Terms of Reference for FTA negotiations in March 2026. The Maldives already has an FTA with China (effective 1 January 2025), which creates pressure for the India-Maldives FTA to move forward. Once concluded, the FTA and BIT will significantly improve the investment framework for Maldivian investors in India and vice versa.

Press Note 3 does NOT apply to the Maldives. Although the Maldives is India's nearest maritime neighbor, Press Note 3 (2020) specifically covers countries sharing a land border with India — China, Bangladesh, Pakistan, Nepal, Myanmar, Bhutan, and Afghanistan. The Maldives shares only a maritime boundary, not a land border, so Maldivian investors can use the automatic route for FDI without government approval in most sectors.

Choose Your Entity Type

Four main structures are available to Maldivian investors entering India.

Private Limited Company — the most common choice for South Asian investors. Requires at least two directors (one must be an Indian resident who stayed 182+ days in India during the financial year, per Section 149(3) of the Companies Act, 2013). Allows 100% FDI through automatic route in most sectors. Full limited liability. Mandatory statutory audit every year regardless of turnover. Given the close geographic proximity and strong people-to-people ties, many Maldivian investors find it straightforward to identify an Indian resident director.

Limited Liability Partnership (LLP) — lighter compliance, no mandatory audit below INR 40 lakh contribution or INR 25 lakh turnover, and no board meeting requirements. The designated partner must be an Indian resident who stayed 182 days during the financial year. FDI in LLPs is allowed only under the automatic route in sectors where 100% FDI is permitted.

Branch Office — approved by RBI under FEMA regulations. Can carry out business activities the parent company performs, but profits are taxable in India at 35% plus surcharge and cess. Suitable for Maldivian companies wanting to establish an Indian presence for procurement or logistics operations.

Liaison Office — the most restricted option. Cannot earn income in India. Functions limited to market research, communication, and promotional activities. RBI approval needed. Permission granted for 3 years, renewable. Some Maldivian tourism companies use liaison offices to coordinate with Indian suppliers and tour operators.

FDI Route and Sector Rules

The Maldives does not share a land border with India. Press Note 3 (2020) does not apply. Maldivian investors can use the automatic route for most sectors without prior government approval.

Sectors allowing 100% FDI via automatic route include IT and software, manufacturing, e-commerce (marketplace model), food processing (relevant for Maldivian seafood companies), renewable energy, healthcare and pharmaceuticals, tourism and hospitality, and single-brand retail.

Government approval is required for sectors like defence (beyond 74%), print media, multi-brand retail, broadcasting, and mining.

Prohibited sectors remain off-limits: atomic energy, lottery, gambling, chit funds, Nidhi companies, tobacco manufacturing, and real estate (with exceptions for townships and construction-development).

For Maldivian investors, the most relevant sectors are tourism and hospitality operations (100% automatic), seafood and fish processing (100% automatic under food processing), healthcare services (100% automatic), renewable energy (100% automatic — particularly solar, given the Maldives' climate change priorities), and IT services (100% automatic).

Step-by-Step Registration Process

Here is the actual process for Maldivian investors, step by step, with realistic timelines.

Document Checklist for Maldivian Investors

For the foreign director or shareholder based in the Maldives, you will need:

• Passport (color scan, all pages with validity)
• Address proof — utility bill or bank statement not older than 2 months
• Passport-size photograph (white background)
• Board resolution from Maldivian parent company authorizing India investment (if applicable)
• Certificate of Registration of Maldivian parent company (attested by Indian High Commission)
• Memorandum and Articles of the Maldivian company (attested by Indian High Commission)
• Bank statement showing source of funds
• Any documents in Dhivehi must be translated into English by a certified translator

The attestation process requires three steps: (1) notarization by a Maldivian notary or the Attorney General's Office, (2) authentication by the Maldivian Ministry of Foreign Affairs, and (3) attestation by the High Commission of India in Male (Lot No. 11499 N1 56 (E) Hithigas Magu, Hulhumale Phase-I). Budget 2-3 weeks for the full process. Most business documents in the Maldives are already in English, which saves translation time.

Common mistakes: assuming apostille works for the Maldives (it does not), skipping the Maldivian MFA authentication step, and providing documents with only Dhivehi text without English translation.

Tax Rates: Limited DTAA Coverage

India and the Maldives have only a Limited Agreement covering international air transport income. For all other income types, Indian domestic withholding rates apply:

The Tax Information Exchange Agreement (TIEA) between India and the Maldives facilitates exchange of tax information but does not reduce withholding rates. The SAARC multilateral agreement on tax administration cooperation also applies. Once the FTA and BIT negotiations conclude, a comprehensive DTAA may follow — but that is not yet in force.

The Maldives does not levy income tax on individuals (no personal income tax) but does have a Business Profit Tax (BPT) of 15% on companies. This asymmetry in tax systems makes India-Maldives tax planning unique — the Maldivian investor may face minimal domestic tax on repatriated income but significant Indian withholding.

Realistic Timeline

Total: 8-10 weeks from start to finish. Here is the honest breakdown.

• DSC + DIN: 1-3 days
• Name reservation: 1-4 days
• Document preparation + embassy attestation in Maldives: 2-3 weeks (shorter than many non-Hague countries due to geographic proximity and efficient Indian High Commission in Male)
• SPICe+ filing to Certificate of Incorporation: 5-15 working days
• Bank account opening: 2-4 weeks (enhanced KYC for foreign-owned entities)
• GST registration (if needed): 1-3 weeks

The Maldives' proximity to India (Male to Kochi is a 1.5-hour flight) means courier and coordination times are minimal. Direct flights operate between Male and multiple Indian cities including Kochi, Bengaluru, Chennai, Mumbai, and Delhi. This geographic advantage translates to faster document processing compared to investors from distant countries.

Post-Registration Compliance

Once your Indian company is incorporated, the compliance calendar starts immediately.

• FC-GPR filing with RBI — within 30 days of share allotment to the foreign investor. Mandatory under FEMA. Miss it and you face compounding penalties.
• Board meetings — 4 per year for a Private Limited company. First meeting within 30 days of incorporation.
• Annual General Meeting — by September 30 each year.
• AOC-4 filing — financial statements filed with MCA within 30 days of the AGM.
• MGT-7 annual return — filed within 60 days of the AGM.
• Statutory audit — mandatory every year, regardless of turnover.
• Income tax return — due by October 31 for companies requiring transfer pricing audit.
• GST returns — monthly or quarterly if registered.
• Transfer pricing documentation — required if there are related-party transactions between the Maldivian parent and Indian subsidiary.

Bank Account Opening

Plan for 2-4 weeks after receiving the Certificate of Incorporation.

Foreign-owned companies face enhanced KYC requirements. You will need FATCA/CRS declarations, verification through an Authorized Dealer (AD) bank, and the AD bank will scrutinize the source of initial capital.

Banks with experience handling South Asian investor accounts include HDFC Bank, ICICI Bank, State Bank of India (which has historically had a strong Maldives connection), and Yes Bank. SBI may be a particularly good option given India's government-backed development relationship with the Maldives.

The Maldivian Rufiyaa (MVR) is pegged to the US Dollar. Your AD bank will process inward remittance — typically in USD given the Maldives' dollar-based economy — and convert to INR at prevailing rates. India's UPI-RuPay integration with the Maldives (signed July 2025) may further facilitate cross-border payment flows in the future.

Profit Repatriation

Without a comprehensive DTAA, repatriation carries higher tax costs than for investors from treaty countries.

Dividends — the most common method. Withholding at 20% plus surcharge and cess. Process: declare dividend, deduct TDS, issue Form 16A, obtain CA certificate (Form 15CB), file Form 15CA with the income tax portal, instruct the AD bank to remit.

Royalties and management fees — 20% withholding plus surcharge and cess. Requires a proper intercompany agreement and arm's-length pricing documentation.

Share buyback — taxed as additional income in the hands of the company at 20% plus surcharge. Can serve as an exit mechanism.

One advantage for Maldivian investors: the Maldives has no personal income tax. So while Indian withholding is at the full 20% rate, the repatriated funds face no further tax on the Maldivian side for individual investors. For Maldivian companies, the Business Profit Tax of 15% applies, but foreign tax credits may be available under Maldivian domestic law — consult a Maldivian tax advisor.

Exit Strategy

If your India venture does not work out, here are your options.

Strike-off under Section 248 of the Companies Act, 2013 — for dormant companies with no assets or liabilities. File STK-2 with MCA. Takes 3-6 months. Requires nil tax liabilities and closed bank accounts.

Voluntary liquidation under the Insolvency and Bankruptcy Code, 2016 — for active companies. Requires a special resolution, appointment of a liquidator, and completion within 12 months (extendable). More involved but cleaner for companies with actual operations.

How Beacon Filing Helps

We handle the complete India entry process for investors based in the Maldives. From initial structuring through post-incorporation compliance:

• Foreign Direct Investment advisory — route selection, sector analysis, RBI compliance, and FC-GPR filing
• Resident Director services — appointment of a qualified Indian resident director who meets the 182-day requirement
• Company setup and incorporation — SPICe+ filing, DSC, DIN, name reservation, and Certificate of Incorporation
• Tax structuring advisory — non-DTAA planning, transfer pricing documentation, and annual compliance
• Accounting and statutory audit — bookkeeping, financial statements, ROC filings, and GST returns

Related Country Guides

Setting up from a different country? These guides cover similar territory:

• Register a Company in India from Sri Lanka
• Register a Company in India from Bangladesh
• Register a Company in India from Singapore
• Register a Company in India from UAE
• Register a Company in India from Malaysia
• Register a Company in India from Thailand

Get in Touch

Setting up an Indian company from the Maldives? Talk to us. No commitment, no generic sales pitch. We will walk you through the structure, timeline, and costs specific to your situation.

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