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Japan to India · Capability centres

Global capability centres in India for Japanese groups

, FCA, ICAI M. No. 542375 · Updated

In brief

A Japanese group's captive centre in India is usually a wholly owned subsidiary paid on a cost-plus basis. The design points are the transfer pricing model, assignment of IP to the parent, GST treatment of exports, data transfers, and keeping parent staff from creating a permanent establishment.

What is specific to Japanese companies

Japanese groups increasingly use India for IT and engineering support for global operations.

Our services

How S U & CO. helps

We set up and run capability centres and sector-specific entities.

  • Sector FDI conditions and approvals
  • Capability centre structuring and cost-plus model
  • GST export set-up and refunds
  • Payroll for fast-growing teams
Send a queryGlobal Capability Centre setupIndian subsidiary (private limited company)Payroll and expatriate tax

Questions

Can a capability centre start under an employer of record?

Yes, for a short period, but a subsidiary is needed for scale, IP and transfer pricing clarity.

General information as at 5 November 2026, not advice for a particular case. Indian and Japanese rules change often; confirm the current position before acting. Japanese law points should be confirmed with a Japanese adviser.

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