India VS Thailand: Which Country Should You Choose for Starting a Business?
India and Thailand are Asia’s top business destinations. Though they don’t have much difference, it’s inevitable to compare the two countries—India VS Thailand.
Looking at the two countries, India is popular for its cuisine, cultural heritage, and diverse geographical attractions, while Thailand is famous for its forest and beaches. Even if socially and culturally, we can separate the countries, in terms of the economic environment and sustainability, it can be difficult.
Nevertheless, since it is more developed, and for many other reasons, India is the “easier” place to start your business. Read further below to learn more about why India is preferable to Thailand.
In choosing which country to set up a business in, its economy is the first thing to look into. India ranks as the 7th biggest economy globally with a $2.7 trillion GDP, while Thailand ranks 26th with $505 billion. India and Thailand rank 6th versus 86th respectively, by GDP 5-year average growth.
Ease Of Doing Business
After the economy is the ease of doing business, the Indian economy and government policies make it more convenient for entrepreneurs to kickstart a business. This convenience is possible through favourable business regulations, easier registration processes, and development in various sectors. Essentially, the country has reduced the set of registration requirements and processes from 12 to just 6. This means that you can legally start a business in India within six days from applying for company registration, compared to 26 days from before.
On the other hand, starting up a business is “arduous” in Thailand. First, the high business registration fee is very distinguishable. Secondly, there’s a restriction that limits foreigners to own only 49% of Thai business shares. Third, are job licenses. Also, there’s a limitation of one foreign worker for every four Thai workers. Such restriction forces small foreign business owners to recruit additional Thais workers to sit around doing nothing.
When thinking about doing business, ensure that you are clear about the country’s corporate income tax rates. In India, a local business is charged for its income earned, either local or international. At the same time, taxing a non-resident corporation is based on profits earned in India. Furthermore, the amended Taxation Laws Act of 2019 declared a favourable CIT rate of 15%. This rate is for newly concurred Indian companies, whether your income accrues or is considered to accrue in India.
Whereas, Thailand’s corporate income tax, which is roughly 30 %, is high. This country’s income tax ranks as one of the highest rates in Asia.
Cost of Living
Another important factor to take into account in setting up a business is the cost of living. There’s a big difference between the two countries when it comes to their cost of living. Compared to India, Thailand’s commodity prices are 96.81 % higher.
Even rental costs in Thailand are higher and considered the most expensive in Asia. Rentals in Thailand are 113.96 times higher than in India. It simply implies that you must increase your budget if you plan to start a business in Thailand.
Another major limitation is the high cost of medical care in Thailand. One must pay 38% more on healthcare compared to that in India. Besides, living in Thailand exposes you to 2.6 times higher risks of diseases and life-threatening conditions such as HIV / AIDS.
Still in Doubt Where to Set Up Your Business? We Got Your Back
Thailand is a strategic location for a business, but it’s not the best to register a start-up business as a foreign investor. Unless you’re good with the nature of running a Thai business, consider setting a business in India instead. Then partner up with 3E Accounting so that you and your employees will reap the rewards of solely focusing on a successful Indian business and lifestyle.