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For a UK business, investor or entrepreneur planning to enter India, choosing the right industry matters as much as choosing the right legal structure. India offers a deep talent pool, a growing consumer market and government incentives across several high-potential sectors.
However, not every industry offers the same return. Some are growing faster and have stronger policy support, while others are more crowded or tightly regulated. Choosing the wrong sector or entering without understanding the rules can delay market-entry plans.
The five sectors below stand out for their growth, policy backing and openness to foreign investment in 2026:
- Technology and digital services — software, AI, fintech and Global Capability Centres
- Healthcare and life sciences — pharma, medical devices, diagnostics and biotech
- Education and EdTech — digital learning, skilling and university partnerships
- Clean energy and sustainability — solar, wind, green hydrogen and battery storage
- Consumer brands and retail — organised retail, e-commerce and premium products
Table of Contents
1. Technology and Digital Services
India’s technology and digital services sector is one of the country’s fastest-growing industries and a major destination for foreign investment. India is a global leader in software development, IT services, artificial intelligence (AI), cloud computing, fintech, cybersecurity and Global Capability Centres (GCCs). The sector generated around US$283 billion in revenue in FY25, supported by a skilled workforce, strong digital infrastructure and growing demand from businesses worldwide. This makes India an attractive destination for UK companies looking to expand their technology operations or establish digital service hubs.
Opportunities for UK firms:
- Software, SaaS, AI, fintech, cloud, cybersecurity and data analytics
- Setting up or partnering with Global Capability Centres (GCCs)
- Digital transformation and engineering R&D services
- Access to a large, cost-competitive technical talent pool
Government advantages:
- 100% FDI under the automatic route in most IT and software services
- Digital India and Startup India support, including startup tax incentives
- GCC incentives in Bengaluru, Hyderabad, Pune, Chennai and Gurugram
- State-level benefits such as subsidised land, and stamp duty and electricity duty exemptions
- Several UK firms, including BT Group and ARM, already run significant R&D operations in India Why forming a tech company here benefits UK firms?
In technology, having your own registered company in India gives you a real edge. Setting up your own entity, instead of outsourcing from abroad, is what lets you build something that lasts:
- Establish a stronger local presence. Having a registered company in India builds trust with customers, suppliers and government authorities, making it easier to win contracts, form partnerships and grow your business.
- Keep your IP fully yours. With 100% ownership on the automatic route, your software, R&D and data stay completely yours — no local partner needed.
- Hire and bill in India. Your own company lets you employ Indian tech talent directly, invoice Indian clients in rupees, and run a Global Capability Centre as a long-term base rather than a short-term contract.
2. Healthcare and Life Sciences
India’s healthcare and life sciences sector is expanding quickly, driven by rising healthcare spending, an ageing population and advances in medical technology. Known as the “pharmacy of the world,” India supplies roughly a fifth of the world’s generic medicines by volume and around 60% of its vaccines. The pharmaceutical market is worth about US$58 billion (2025), the hospital market is projected to reach around US$194 billion by FY32, and the medical devices industry is targeted to grow from about US$12 billion to US$50 billion by 2030. Backed by a large patient population, rapid digital health adoption and strong government support for healthcare infrastructure and pharmaceutical manufacturing, the sector offers significant long-term opportunities for UK businesses.
Opportunities for UK firms:
- Pharmaceutical and generic drug manufacturing – because India is the world’s largest supplier of generic medicines and offers cost-effective production.
- Medical devices, diagnostics and biotechnology – because demand is rising with increased healthcare investment and technological innovation.
- Hospitals, clinics and healthcare infrastructure – because expanding healthcare access is driving significant investment in new facilities.
- Cost-efficient manufacturing for domestic and export markets – because India combines competitive manufacturing costs with access to a large domestic market and global export networks.
Government advantages:
- Production Linked Incentive (PLI) schemes for pharmaceuticals and medical devices
- Support for bulk drug parks and medical device parks
- 100% FDI under the automatic route for greenfield pharmaceutical projects (brownfield up to 74% automatic; medical devices 100% automatic)
- Ayushman Bharat, expanding healthcare infrastructure and demand
- FDI limit in the insurance sector increased from 74% to 100%, encouraging foreign investment and expanding access to health insurance.
Why does forming a healthcare company in India benefit UK businesses?
In healthcare, having your own company in India works far better than just selling into the country from abroad. Some of the biggest benefits are only open to a business registered in India:
- Get the government incentives. Support like the PLI schemes for medicines and medical devices, and the special drug and device parks, is only for India-registered companies. If you just export, you miss out.
- Make products cheaply, sell widely. With your own company, you can manufacture in India at a much lower cost than in the West, and sell both inside India and abroad. You can own 100% of a new pharma business and any medical-device business.
- Deal with regulators and win contracts. A local company can get its products approved by CDSCO, run clinical trials, and bid for big government health contracts like Ayushman Bharat and Jan Aushadhi.
3. Education and EdTech
India’s education sector is changing rapidly, shaped by rising enrolment, wider internet access and government reform. With one of the largest student populations in the world, it is a significant market for education providers and EdTech companies, supported by rapid uptake of online learning, strong demand for upskilling, and reform under the National Education Policy (NEP) 2020. Combined with the global reputation of UK education, India’s large student base, expanding digital infrastructure and growing demand for quality learning create significant opportunities for UK education providers and EdTech businesses.
Opportunities for UK firms:
- EdTech platforms and online and hybrid learning
- Vocational training and professional upskilling
- Joint venture universities, university partnerships and higher-education collaboration
- Curriculum, assessment and English-language programmes
Government advantages:
- National Education Policy (NEP) 2020, encouraging digital learning and international collaboration
- Skill India Mission for vocational training and workforce development
- Digital platforms such as DIKSHA and SWAYAM
- 100% FDI under the automatic route in most education services, subject to applicable regulations
Why forming an edtech company here benefits UK firms
In education, UK businesses can enter the Indian market through partnerships, remote delivery or by setting up a subsidiary. However, having your own registered company in India provides greater credibility, operational flexibility and access to long-term growth opportunities.
- Take full control of your Indian operations (Invest in Rupees and earn in dollar or pounds). With 100% FDI allowed automatically, your own Indian company can run platforms, offer services and collect fees directly — with no middleman.
- Work with universities. To sign and run tie-ups with Indian universities, you usually need a registered company in India.
- Join government schemes. A local company can hire in India and take part in skilling programmes like the Skill India Mission — growing your reach and your funding.
4. Clean Energy and Sustainability
India is one of the world’s fastest-growing renewable energy markets, targeting 500 GW of non-fossil-fuel installed capacity by 2030 and net-zero emissions by 2070, with expanding investment in renewables, green hydrogen, electric mobility, battery storage and sustainable infrastructure.
Opportunities for UK firms:
- Utility-scale solar and wind projects
- Green hydrogen production
- Battery and energy-storage manufacturing
- EV infrastructure, waste management and climate-tech solutions
Government advantages:
- National Green Hydrogen Mission
- PLI scheme for Advanced Chemistry Cell (ACC) battery manufacturing
- Solar parks with ready infrastructure in several states
- Transmission-related and state-level incentives, and 100% FDI under the automatic route in renewable energy
Why does forming a clean energy and sustainability company in India benefit UK businesses?
Clean energy needs a lot of money upfront and runs on government incentives — which is exactly why having your own company in India matters:
- Get the big incentives. Support like the PLI scheme for batteries, the National Green Hydrogen Mission and state subsidies only goes to companies registered in India.
- Own your projects fully. Renewables allow 100% foreign ownership on the automatic route, so you keep all the returns — no local partner needed to share them with.
- Bid for and build projects. A local company can take part in large government power auctions and use ready-to-go solar parks — options that are effectively closed to a purely overseas business.
5. Consumer Brands and Retail
India’s consumer and retail sector is growing quickly, driven by rising incomes, urbanisation, an expanding middle class and widespread smartphone use. Its retail market is projected to reach around US$2 trillion by 2032 (Anarock–RAI), supported by organised retail, e-commerce and quick commerce, as consumers trade up to premium products and shop increasingly online.
Opportunities for UK firms:
- Branded consumer goods across clothing, beauty, food and personal care
- Physical retail stores and organised retail chains
- E-commerce and quick-commerce channels
- Premium and international product segments
Government advantages:
- 100% FDI under the automatic route in single-brand retail (above 51% subject to local-sourcing conditions)
- 100% FDI in cash-and-carry wholesale
- FDI permitted in the marketplace model of e-commerce under prescribed conditions
Why forming a consumer brand company here benefits UK firms?
For consumer brands, a local entity is what turns market interest into actual shelves and sales:
- Open your own stores. Single-brand retail allows 100% FDI on the automatic route, but a local entity is needed to run outlets and meet the local-sourcing rules that apply above 51%.
- Sell online and stock locally. Incorporating lets you sell through e-commerce marketplaces and set up domestic warehousing for quick commerce.
- Control brand and supply. A local company supports GST registration, domestic supply chains and full control of how your brand is presented in India.
Key Challenges for UK Businesses Entering India
The opportunity in India is significant, but setting up and running a business requires compliance with a wide range of legal, tax and regulatory requirements. Some of the most common challenges UK companies face include:
- Choosing the right business structure (Wholly Owned Subsidiary, LLP, Branch Office or Liaison Office)
- Company incorporation, ROC filings and ongoing Companies Act compliance
- Obtaining PAN, TAN, GST registration and other statutory registrations
- Understanding FDI regulations, RBI reporting and FEMA compliance
- Managing accounting, payroll, labour law and HR compliance
- Corporate tax, GST, transfer pricing and annual tax filings
- Drafting legal agreements and protecting intellectual property
- Keeping up with recurring compliance deadlines and regulatory changes
Turn challenges into opportunities. Talk to our India market entry specialists today.
Strategic Considerations Before Entering Indian Market For UK Businesses
A well-prepared entry lowers complexity and improves the chance of success. Five points matter most:
- Define the objective — a long-term business, delivery centre, market access, demand test or capacity expansion, as each implies a different setup
- Choose the right structure — subsidiary, joint venture, alliance, branch or a phased approach
- Understand market dynamics, which vary widely by region
- Plan operations — recruitment, accounting, technology, payroll and governance — before registering the entity
- Build a solid legal and compliance base covering tax, regulatory adherence and financial controls
How Can Mercurius Help
Entering India is a strategy, not a transaction. We help UK businesses with the whole journey — choosing the right structure, completing approvals and filings, and handling tax, payroll, accounting and governance. Our aim is to be your long-term partner for a smooth, successful expansion in India.
Ready to explore India? Contact Mercurius today to discuss your India market-entry plans.
Phone: India +91 966 777 9615 E-mail: info@masllp.com
