A “Project Office” means a place of businessestablished to represent the interests of aforeign company executing a project in India.Such offices are prohibited from undertakingor carrying on any activity other than theactivity relating to execution of the project for which such officeis established.In order to set up a project office, a foreigncompany has to secure a contract to executea project in India from an Indian company,and the fulfillment of one of the followingconditions:
- Such project is funded directly by inwardremittance from abroad; or
- Such project is funded by bilateral ormultilateral international financing agency; or
- Such project has been cleared by anappropriate authority; or
- The company or entity in India awardingthe contract has been granted a term loanby a public financial institution or a bankin India for the project.
If either of the above conditions is not met,the foreign entity is required to seek RBI approval.
