The Applications are to be made in form FNC and are considered by the RBI under two routes determined by the degree of Foreign Direct Investment (FDI):

• The Reserve Bank Route: taken when the principle business of the foreign company falls under sectors where 100% FDI is permissible.
• The Government Route: when the sectors do not permit 100% FDI investment. The RBI considers applications under this in consultation with the Ministry of Finance of India.

The RBI has a few other considerations:

• Track Record: For a BO a company will require a profit making track record in the in the immediately preceding five financial years in the home country.
• Net Worth: “a total of paid-up capital and free reserves, less intangible assets as per the latest Audited Balance Sheet or Account Statement Certified by a Certified Public Accountant or any Registered Accounts Practitioner”. The net worth has to be equal to or more than USD 100,000.