Corruption risk in India

India’s laws are well established and robust. Its judiciary, however, is less efficient and reliable so you will want to do as much due diligence as you can to avoid having to go to court later, and to protect your own reputation and your business.

Fraud, scams and corruption are ongoing challenges that Australian businesses wanting to operate in India need to be aware of. Australian firms planning to operate in India should also commit to the highest level of corporate behaviour and familiarise themselves with Australian laws and penalties for bribery. Australian individuals and companies can be prosecuted in Australia for bribing foreign officials when overseas.

There are various ways to carry out due diligence in India. Some are tailored to the mode of entry you choose for India and the business structure you are looking to establish.

This section covers common risks to be aware of when conducting business in India and where extra caution may need to be exercised. It is strongly recommended that you seek professional advice to develop specific strategies for your business’ unique situation.

India has a large number of professional services and legal firms that can assist with due diligence. These range from leading international audit, tax and advisory specialists to private business consultants who have lived in India for some time and understand the processes associated with the extensive due diligence required to succeed in the Indian business context.
 

Due diligence and avoiding scams

Your due diligence process should begin with a basic background check to ensure you carefully choose which businesses you trade with or partner with. Request basic information on their existing customers and ask to inspect their operations. If they will not oblige, you may want to consider looking for a new partner.

Download a copy of the India Country Starter Pack to access critical steps for performing due diligence on potential Indian business partners, distributors, suppliers or contractors 

Want to learn more? Explore our other India information categories or download the India Country Starter Pack.