The economy of India is characterised as a developing market economy. It is the world’s fifth-largest economy by nominal GDP and the third-largest by purchasing power parity. According to the IMF, on a per capita income basis, India ranked 142nd by GDP and 119th by GDP per capita in 2018
Types of Business Organization by which One Can Setup Business In India
Some of the popular types of business organization one can setup in India are as follows
1. Individual Entrepreneur/Proprietorship:
This type of Organisation is mostly register by Individuals/Sole who do not want to do business with partnership. In this type of enterprise, the individual entrepreneur supplies the entire capital (even if he has to borrow); he organizes and supervises the business; and he alone is responsible for the results, i.e., gets profit or suffers losses. If necessary, he can employ some persons to assist him
2. Partnership Firm:
When Two or more persons combine together to do business then option is Partnership firm. Partner’s have mutual relations, their rights, and duties, the capital each is to put in, the proportion in which profits and losses are to be shared are laid down in the partnership deed but there is unlimited liability of the partners. It can be unregistered or registered partnership firm. Registered Partnership is governed under Indian Partnership Act 1932.
3. Limited Liability Partnership Firm:
A limited liability partnership is a partnership in which some or all partners have limited liabilities. It therefore can exhibit elements of partnerships and corporations. In a LLP, each partner is not responsible or liable for another partner’s misconduct or negligence.
4. Private Limited Company:
A Private Limited Company is a type of business structure registered to give a separate legal existence to the business apart from its directors and shareholders. This means that a company continues to exist even after the death of any member.It required Minimum 2 Directors and 2 shareholder both can be same person.
5. One Person Company:
A One Person Company (OPC) registration allows individuals to set up a company and enjoy its benefits, without needing a host of employees. Such a company also brings about limited liability for the individual. It required Minimum 1 Person as a director-shareholder and 1 Nominee. It has same feature as private limited company but have restriction of Rs. 2 crore business as after this it need to compulsory convert to private limited.
6. Public Limited Company:
A public Limited Company is a kind of joint stock company that is not a private limited company in the first place. In case of a public company, there are no restrictions whatsoever on the transfer of shares. The shares of a public limited company can be transferred freely on stock exchanges. In a public limited company, there must be a minimum of 7 members and there is no upper limit to the number of members that a public limited company can have.