Doing Business in United States

Published 25 August 2026

In short

Indian businesses register online in Delaware or Texas as an LLC or C-Corporation, file Articles of Organization with the state, obtain an EIN from the IRS, appoint a registered agent, open a US bank account, and register for federal and state taxes within days. No minimum capital or residency required.

Key facts

Capital: Washington, D.C.
Currency: United States Dollar (USD)
Trade with India: US$ 210.18 billion in goods and services in calendar year 2024 (US Census data cited in the MEA India-US Bilateral Brief, as on 16 February 2026). Goods trade was US$ 129.17 billion and services trade US$ 81.01 billion. US imports from India were US$ 128.17 billion and US exports to India US$ 82.02 billion.
Indian community: About 5.4 million Indian Americans and persons of Indian origin, including around 2.07 million non-resident Indians, per MEA data in the India-US Bilateral Brief as on 16 February 2026. Persons of Indian origin are the third largest Asian ethnic group in the US.

The market

The United States is India’s single largest trading partner. Total two way trade in goods and services was US$ 210.18 billion in calendar year 2024, made up of US$ 129.17 billion in goods and US$ 81.01 billion in services, according to US Census data cited in the MEA India-US bilateral brief of February 2026. India ran a surplus of about US$ 46.1 billion. Nothing else in India’s trade basket compares for scale or for margin, particularly in software services, generic pharmaceuticals and speciality engineering.

Why Indian businesses go there

Buyers pay more, pay on time and buy in volume. A US customer will accept a price two or three times what the same product fetches in the Gulf, and the addressable market for a niche product is large enough to build a business on a single vertical. For services firms, the US is where the buying decisions for global IT and back office contracts are made. Company formation is also unusually easy. A Delaware or Texas LLC can be registered online in days for a few hundred dollars, with no minimum capital and no residency requirement for shareholders.

The diaspora and business community

About 5.4 million Indian Americans and persons of Indian origin live in the United States, including around 2.07 million non-resident Indians, per MEA data as on 16 February 2026. This is the highest earning and among the best educated ethnic groups in the country. In practice that means access to Indian origin founders, venture investors, hospital purchasing managers, retail buyers and lawyers in almost every metro. Bodies such as TiE chapters and Indian American professional associations are real deal channels rather than social clubs.

Sector strengths

Generic pharmaceuticals and active pharmaceutical ingredients, IT and business process services, gems and jewellery, textiles and apparel, engineering goods and auto components, speciality chemicals, and increasingly software products and healthcare services delivered remotely.

The honest difficulties

Tariffs are now the biggest single risk. Reciprocal duties on many Indian goods rose to 50 percent during 2025. Under the United States India Joint Statement of 7 February 2026 and the interim framework that followed, the reciprocal rate on a large slice of Indian exports was brought down to 18 percent, with zero duty on about US$ 38 billion of industrial exports, but this is an interim arrangement and a full bilateral trade agreement is still being negotiated. Price your contracts with a tariff clause.

Visas are the second problem. India is not an E-1 or E-2 treaty country, so the treaty trader and treaty investor routes that many other nationalities use are simply not available to Indian passport holders. That pushes founders towards the L-1 intra-company transfer, which needs a genuine qualifying Indian parent and a year of prior employment, or towards H-1B with its annual lottery. Employment based green card queues for Indian nationals run to many years.

Third, there is no social security totalisation agreement between India and the United States, so an Indian employee on a US payroll pays into US Social Security and Medicare with no easy way to get that money back. Fourth, tax is not one system. Federal corporate tax is 21 percent, but each state adds its own corporate income tax, franchise tax and sales tax, and having staff or inventory in a state creates nexus and filing obligations there. Fifth, litigation and product liability exposure is far higher than in India, so product liability insurance, clear warranty terms and proper FDA, FCC, UL or CPSC compliance are not optional.

How to apply

Choose the state of incorporation. Delaware is the default for companies raising venture capital because of its settled corporate law; Texas, Florida, Wyoming and Nevada are common for trading and holding companies. You can incorporate in one state and operate in another.
Choose the entity. A C-Corporation suits anyone raising US investment or issuing stock options; an LLC is simpler and cheaper for a sales or distribution arm of an Indian parent.
Appoint a registered agent with a physical address in the state of incorporation. This is a legal requirement and costs a small annual fee.
File the Certificate of Incorporation or Articles of Organization with that state's Secretary of State, usually online, and pay the filing fee.
Adopt bylaws for a corporation or an operating agreement for an LLC, issue shares or membership interests, and hold the organisational meeting.
Apply to the Internal Revenue Service for an Employer Identification Number using Form SS-4. Founders without a US Social Security Number apply by fax or post, which takes longer than the online route.
Open a US business bank account. Most banks want the EIN, formation documents and at least one signatory present in person, so plan a trip or use a bank that onboards foreign owned companies remotely.
Register to do business in every other state where you have an office, employees or inventory. This is called foreign qualification and triggers state tax filings.
Register with each relevant state department of revenue for corporate income tax, franchise tax and sales tax, and set up sales tax collection where you have economic nexus.
Register for payroll with the IRS and the state, and set up unemployment insurance and workers compensation before your first US hire.
Obtain the industry licences and product approvals you need, for example FDA registration for food, drugs, devices and cosmetics, FCC for radio emitting devices, and UL or ETL listing for many electrical products.
Take commercial general liability and product liability insurance before you ship. US buyers and retailers usually require certificates of insurance naming them as additional insured.
File beneficial ownership information with FinCEN if your entity falls within the current reporting rules, which have changed since 2024, so confirm the position that applies to a foreign owned US company at the time you register.
Set up transfer pricing documentation and an intercompany agreement between the Indian parent and the US entity before any invoicing starts.

What the trade actually looks like

→ India sells

Pharmaceuticals and generic medicinesIndian companies supplied 1.8 billion of 6.7 billion US prescriptions in 2022 and contributed US$ 219 billion of the US$ 408 billion saved by generics that year (MEA bilateral brief).
IT and business servicesUS services imports from India were US$ 40.75 billion in calendar year 2024, the largest services line in the relationship.
Gems and jewelleryCut and polished diamonds and gold jewellery. Under the February 2026 framework, diamonds and platinum move to zero reciprocal duty.
Textiles and apparelReciprocal duty came down from 50 percent to 18 percent under the February 2026 arrangement, with silk at zero.
Engineering goods, machinery and auto componentsMachinery is the largest single US import category by market size among the sectors covered by the 2026 tariff relief.
Leather goods and footwearAlso moved from a 50 percent to an 18 percent reciprocal rate in February 2026.

← India buys

Crude oil, LNG and other hydrocarbonsIndia's hydrocarbon imports from the US were about US$ 10.27 billion in FY 2024-25, up 31 percent on FY 2023-24 (MEA bilateral brief).
Aircraft, spacecraft and partsLarge Indian airline orders make this one of the biggest single US export lines to India.
Precious stones and metalsRough diamonds and gold move both ways between the two markets.
Machinery, electrical machinery and instrumentsCapital goods for Indian manufacturing, plus medical devices.
Agricultural productsAlmonds, apples, pulses and, under the February 2026 framework, dried distillers' grains, sorghum, tree nuts, soybean oil, wine and spirits at reduced or zero Indian duty.

Treaties and agreements with India

India US interim reciprocal trade framework and Joint Statement 7 February 2026

Brings the US reciprocal tariff on a large part of Indian exports down from 50 percent to 18 percent, with zero duty on about US$ 38 billion of industrial exports and US$ 1.36 billion of agricultural exports. In return India cuts duties on US industrial and farm goods. It is an interim step towards a full Bilateral Trade Agreement, so treat the rates as subject to change.

Double Taxation Avoidance Agreement (Convention) Signed 12 September 1989, in force 18 December 1990

Prevents the same income being taxed twice and sets ceilings on withholding tax for dividends, interest, royalties and fees for included services. It also contains the permanent establishment test that decides whether your US sales activity creates a taxable presence, which matters if you send staff to the US on projects.

India US Trade Policy Forum (TPF) Established 2005, revived 2021

The standing ministerial channel where market access irritants get resolved, covering issues like agricultural sanitary approvals, medical device pricing, digital trade and standards recognition. Not a treaty, but the practical route through which an Indian industry body can escalate a US regulatory barrier.

No social security totalisation agreement Not concluded as of August 2026

This is an absence worth planning for. Indian nationals on US payroll pay Social Security and Medicare contributions with no portability back to India and, unless they work long enough to vest, no benefit. Budget roughly 7.65 percent employer and 7.65 percent employee cost on top of salary.

Which company type to use

C-Corporation	Separate taxable entity at 21 percent federal plus state tax. Required in practice if you want US venture capital, a stock option pool or an eventual US listing.
Limited Liability Company (LLC)	Flexible and cheap, and a single member LLC owned by an Indian company is disregarded for US tax purposes, which can create unexpected filing duties for the Indian parent. Good for a sales arm.
S-Corporation	Pass through tax treatment but shareholders must be US citizens or residents, so it is generally not available to an Indian owned business.
Branch office of the Indian company	Possible but rarely used. It exposes the Indian company directly to US tax on effectively connected income and to US litigation, and adds a branch profits tax.
Representative or liaison office	Not a formal US legal category. Marketing only activity is usually run through a subsidiary anyway, because even limited staff presence can create tax nexus.

Visas and tax

Getting yourself there

India is not an E-1 or E-2 treaty country, so the treaty trader and treaty investor visas are closed to Indian nationals. The practical founder route is the L-1A or L-1B intra-company transfer, which needs a qualifying Indian parent and one year of prior employment with it. Other routes are H-1B through the annual lottery, O-1 for extraordinary ability, and EB-5 for investors. B-1 covers meetings only, not productive work.

What you will pay

Federal corporate income tax is a flat 21 percent for resident corporations. State corporate income taxes are charged on top and generally range from about 1 percent to 10 percent, with some states levying none, plus state franchise taxes and state and local sales taxes. A Double Taxation Avoidance Convention with India exists, signed on 12 September 1989 and in force from 18 December 1990. There is no social security totalisation agreement with India.

Indian government support for this market

Pharmaceuticals Export Promotion Council of India (Pharmexcil)

The Department of Commerce sponsored council for India's largest value added export to the United States. It supports members on US FDA registration, DMF and ANDA related market access issues, runs delegations to US trade shows, and takes up regulatory barriers through the Trade Policy Forum. Membership gives access to country specific market intelligence.

Federation of Indian Export Organisations (FIEO)

The apex export body under the Department of Commerce. It issues Registration cum Membership Certificates, runs US buyer seller meets, and has been the main channel for circulating official guidance to exporters on the 2025 and 2026 US tariff changes. Its regional offices help MSMEs with documentation and buyer verification.

ECGC Limited

Government owned export credit insurance. It covers commercial default and political risk on US receivables and helps exporters obtain bank credit at concessional rates against insured invoices. Given the tariff uncertainty and longer US payment cycles, cover on large single buyer exposures is worth the premium.

Trade Connect ePlatform, Directorate General of Foreign Trade

The Department of Commerce single window launched on 11 September 2024. It connects Importer Exporter Code holders with Indian missions in the US, export promotion councils and trade experts, and carries product and country guides plus an Ask an Expert facility for tariff and documentation questions.

Frequently asked questions

What is the best state to incorporate a US company from India

Delaware is default for venture-backed companies because of settled corporate law. Texas, Florida, Wyoming and Nevada suit trading or holding companies. You can incorporate in one state and operate in another, giving flexibility.

How long does it take to form a US company as an Indian business

A Delaware or Texas LLC registers online in days for a few hundred dollars. No minimum capital or residency required. You then need an EIN from the IRS, registered agent appointment, and bank account setup, adding another week or two.

What licenses and approvals do Indian exporters need in the USA

FDA registration for food, drugs, devices and cosmetics; FCC for radio devices; UL or ETL listing for electrical products. Confirm requirements by industry. Product liability insurance naming US buyers as additional insured is mandatory before shipment.

What are the main tax obligations for a US company owned by an Indian parent

Federal corporate tax is 21 percent plus state corporate income tax, franchise tax and sales tax where you have nexus. Register with each state where you have office, staff or inventory. Set up transfer pricing documentation and intercompany agreements before invoicing starts.

Can Indian passport holders get visas to work in a US company

India is not an E-1 or E-2 treaty country. Founders use L-1 intra-company transfer with a genuine Indian parent and one year prior employment, or H-1B lottery. Employment-based green card queues run many years for Indian nationals.

What are the biggest business risks for Indian exporters to the USA

Tariffs are the top risk; reciprocal duties are now 18 percent under interim agreement but subject to renegotiation. Visa access is limited for Indian founders. Litigation and product liability exposure is far higher than India, so insurance and compliance are not optional.

Before you apply: confirm every date, fee and eligibility rule on the official website linked on this page. Public and Policy is an independent portal, not a government body, and details change without notice.