FAQ: Can Indian and Russian companies establish a joint venture?

Indian and Russian companies can establish a joint venture (JV) under the laws of both countries. The choice of jurisdiction—Russia or India—depends on the target market, business model, and strategic objectives of the partners.

Available legal structures

In Russia, a JV can be established as a limited liability company (LLC), a joint-stock company (JSC), a production cooperative, or through a simple partnership agreement. LLCs are popular for their flexibility and limited liability, requiring a minimum capital of 10,000 roubles. JSCs suit larger ventures planning to issue shares, with minimum capital requirements varying by type.

In India, common structures include private limited companies, limited liability partnerships (LLPs), or contractual joint venture agreements. Private limited companies offer operational autonomy and are governed by the Companies Act, 2013. LLPs provide flexibility with lower compliance requirements.

The choice depends on the control requirements, capital structure, liability protection, and tax implications in each jurisdiction.

Key steps to establish a JV

Establishing a JV requires careful planning and execution:

• Defining ownership structure and equity distribution between partners
• Drafting a comprehensive JV agreement covering governance, profit sharing, intellectual property rights, exit clauses, and dispute mechanisms
• Registering the legal entity with relevant authorities (the Federal Tax Service in Russia or the Registrar of Companies in India)
• Opening corporate bank accounts in the chosen jurisdiction
• Obtaining sector-specific licences and permits if required for regulated industries

Advantages of India—Russia joint ventures

India—Russia JVs offer strategic benefits for both partners:

• Access to local markets with reduced operational and regulatory risks
• Combined Russian technology and Indian manufacturing capabilities or distribution networks
• Localisation of products and services to meet market-specific requirements
• Simplified entry into e-commerce platforms and B2B marketplaces in both countries
• Leverage of established partner networks and regulatory expertise

Tax considerations

JVs must navigate tax obligations in both jurisdictions. Russia has a 25% corporate income tax (as of 2025) on profits, alongside 20% VAT (subject to increase in 2026) and customs duties. In India, the corporate income tax is 25% for companies with turnover up to ₹400 crore and 30% for larger companies, with GST ranging from 0% to 40%, depending on the goods/services category.

The India—Russia Double Taxation Avoidance Agreement (DTAA) helps prevent double taxation on the same income. Special tax incentives may be available through technology parks, special economic zones, and export-oriented units in both countries.

Successful JVs

India—Russia JVs have thrived across multiple strategic sectors.

• In pharmaceuticals, Dr. Reddy’s Laboratories and other Indian companies are establishing major manufacturing facilities in Russia for producing high-quality medicines and pharmaceutical substances.
• The HAL—UAC collaboration plans to produce SJ-100 civilian aircraft in India under the Make in India programme.
• A joint urea production venture announced in December 2025 leverages Russia’s fertiliser expertise to strengthen India’s agriculture supply chains.
• In IT services, Russian companies (including Sberbank) have established development centres in India, combining Russian technology with Indian programming talent.

Related articles:

• Investing in the future: how to enter the Russian market
• Unpacking the matryoshka: how to work with your Russian partners