Foreigner buying a guesthouse, setting up business in india

Hi,
i am new to India Mike. i really enjoy this site.

I live in the US now, however my dream is to relocate to India permanently. For now i have a 10 year tourist visa.

I have about 50k in savings that i would like to use to maybe:
buy a guetsthouse, set up an internet cafe in goa/kerala or another tourist's business, like a cafe bar.

my questions are:
can a foreigner with a toursit visa buy a guesthouse? and operate it legally?
if not, do i need to get a business visa first? and how do i get a business visa if i do not operate a business in US now?

thanks
sridevi

No can do and there is a ton of resources on the site to give you the details of why. In a nut shell you can't stay long enough legally to buy, etc. The Indian authorities have cracked down on this lately as well. Use the links and google advanced restricted to this site to mine the invaluable resources here on that topic. Also, recognize that business in India is a real challenge and nothing like at home (unless perhaps you are from Italy)..

Apart from the legal aspects mentioned by edwardseco, business in India might involve bureaucracy, bribes, "contacts", delays, each official applying the law acording to his own understanding, and so on. For an outsider, it is difficult to figure out on your own how things work, even if you have lived here for a considerable while.

There are a lot of people coming here to ask this kind of question and I'm afraid that we always disappoint them.

sridevi, are you of indian origin?

if so then you have a leg up on 99% of the people who ask such questions.

if not, get in line for your lovin' spoonful of disappointment.

There are foreign-owned resorts/hotels/etc in India. I'm sure that it can be done.

Or perhaps the sad fact is that it could be done --- the ones I've heard of in Kerala have been established some years.

A real, solid business plan with a heap of capital (rather more than you have, I'm afraid...) and Indian contacts might get you a business visa. That would be, as Icetea is pointing out, the start of your problems.

Like Nick said, there are foreigners who have done it. Iknow a few.
e.g. a couple from England own the Oceanic Hotel by Palolem. They bought it not too many years ago. They told me that it took them 2 years to finally get it. www.hotel-oceanic.com
And also i've been told in India the laws are that even if you buy something, a relative can come later and say that they didn't have the right to sell it without my permission and take it from you.

...You have to check the title to the best of your ability. In many places, that means you read through the documents, one by one.

Thankfully, most relatives are too busy trying to take property off each other!

You might even find a whole tribe turning and claiming that the land was stolen from them 50 years ago.

Not to mention the other five people the guy you bought off also sold the property to.

But, hey! don't worry, you can keep all the claims in court for years as long as you don't mind the lawyers' fees....

OK. I guess most Indian property deals actually conclude without any major problems. But all of the above, and more, does happen...

or perhaps find a local person and partner with the person to buy property, offcourse partnership has it's owen pros and con.

With all the recent trouble about Foreigners purchasing land or property on a tourist visa, it has caused enough of a stink to have to government make changes on the business visa, a 6 month 'B' now says "Not exceeding 180 days".
In order to get a longer business visa, you or the person you work for has to have a business registration number and a letter of acceptance from the RBI.

In the last few weeks the FRO has sent out a standard letter to the foreign property owners in Goa, stating that they purchased land/property illegally and that they are not entitled to retire in India or words to that affect, this is of course a standard letter has it would take more time to write individual letters or to find the real offenders. It doesn't seem to matter to them if you complied with the rules of FEMA and have all the documents to prove it.

Apart from all that, it is possible to run a small tourist related business in India, but be warned, it's a long dusty road with more pot holes in it than the road to Ooty.

I think these people had already been identified and the RBI was the first body instructed to investigate. This is more likely the beginning than the end. The Home Dept. are not considering any foreigner registrations until new directives are issued. This is not likely before end May. I personally know 2 people who were refused x visa extensions and told to "retire in your own country".

try consider leasing
more safer options

i wanted to know if finally you managed to realise your dream? and if so, if you have any tips?

thanks

The OP has not logged in since Mar 8th, 2008