Can You Open a Buying Office in India?

Yes, but it's probably not the office you're picturing. A foreign importer can open a liaison office with a bank's approval under Reserve Bank of India rules, as long as it has three profitable years and a net worth of at least US$50,000. That office can promote trade and be your link to Indian suppliers, but it can't earn income in India, and acting as your buying agent is listed for a branch office, which needs five profitable years and US$100,000.

Importers usually ask me this once their India orders get big enough to feel risky from a distance. The instinct is right, because someone on the ground really does change things. But an office is the heaviest way to get that someone.

Below is what the rules allow, read from the RBI's own Master Direction, and the lighter routes most buyers end up taking. One honest caveat - the RBI has had new draft rules out since October 2025, so check the current position before you plan around any of this.

1. What a Liaison Office Is Allowed to Do

Think of it as a representative office. Under the RBI's Master Direction it can represent the parent company in India, promote exports and imports, promote technical or financial tie-ups and be the communication channel between the parent and Indian companies (RBI Master Direction (opens in a new tab)). For a buyer that covers the jobs that matter - visiting factories, chasing orders, running quality checks and talking to suppliers in their own time zone.

What it can't do is trade.

It doesn't sell, it doesn't charge your suppliers anything and it doesn't earn a commission. Its running costs come from head office, through the one kind of money its bank account is allowed to receive. If you were hoping the office would pay for itself by taking a cut from Indian factories then that's exactly the door the rules close.

2. What You Need to Qualify

For a liaison office, the parent needs "a profit making track record during the immediately preceding three financial years in the home country and net worth of not less than USD 50,000" (same Direction). Falling short as a subsidiary? You can lean on a letter of comfort from a parent that meets the tests.

Approval normally comes from your Indian bank (an authorised dealer bank), not from the RBI itself. Prior RBI approval is needed only in listed cases, which include applicants from certain countries, some sectors and regions, NGOs and foreign government bodies.

The permission is "generally for three years", it can be extended and the office files an annual activity certificate every year. One adviser puts approval at 20 to 24 weeks (Mondaq (opens in a new tab), an adviser's estimate). Let an Indian chartered accountant or lawyer run the filing, because the forms and the yearly reporting are the bit people always underestimate.

3. What If You Want It to Be Your Buying Agent?

Then a liaison office is the wrong vehicle. The Direction lists acting "as buying/ selling agent in India" among the activities of a branch office, and a branch needs five years of profit and at least US$100,000 net worth (same Direction). It's a much bigger commitment, with more reporting and Indian tax questions that a liaison office mostly dodges, so get Indian tax advice before you go anywhere near it.

The line to remember is short. A liaison office can watch, check and talk, but it can't buy for you as a commercial agent and it can't make money.

4. Is the Rule About to Change?

Possibly. On 3 October 2025 the RBI put out draft Foreign Exchange Management (Establishment in India of a Branch or Office) Regulations, 2025, for comment (RBI press release (opens in a new tab)). Advisers who've summarised it say it would merge the office types and drop the net-worth and profit tests (EY, Dec 2025 (opens in a new tab)).

On 13 October 2026 it still wasn't on the RBI's list of FEMA notifications (opens in a new tab), and the Master Direction still showed its May 2021 update. Until that changes, the 2016 rules and the Master Direction apply, so do check with your Indian bank before you file.

5. Liaison Office or Branch Office?

(RBI Master Direction, as above)

6. Do You Actually Need an Office?

Most importers don't, and I'd say that even if we didn't run a service that competes with one. Here are the realistic options, lightest first -

• A sourcing agent. One person or a small team working for you on a fee or commission. Good for one category and a handful of suppliers. More on sourcing agents.
• A buying house. The same idea at scale, with merchandisers and a quality team. Know who pays it and how, as set out on buying house. We found no official regulatory category for buying houses in India. They're ordinary Indian businesses, so check them like you'd check a supplier.
• A third-party inspector. If what you really need is eyes on the goods before they ship, an inspection gets you that without anyone on your payroll.
• A liaison office. Worth it when you have steady volume across many suppliers, want your own staff with your own standards and are happy to fund it from home.

The question that sorts it out is simple. Do you need control or do you need presence? Control comes from contracts, inspections and paying against documents, while presence costs you an office, and most buyers who think they want the second really need the first.

If you'd like a team on the ground without setting anything up, that's what SourcingSync (opens in a new tab) does for importers - supplier visits, order follow-up and quality checks in India, run as a service. The bigger picture of every way to buy is on ways to source from India.

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