India incorporated 18% more companies in January than a year before and more than doubled the number of newly-registered limited liability partnerships (LLPs), adding to the already record float of such entities this fiscal year.
In fact, the incorporation in the first ten months of FY24 beats the full-year numbers for any of the previous financial years, senior government officials said.
Optimism about the country’s medium-to-long term economic growth prospects and steps to ease compliance burden and promote ease of doing business are driving the record incorporation, they said.
According to the latest data compiled by the Ministry of Corporate Affairs, 14,333 companies were incorporated in January, against 12,167 a year before. Similarly, 5,276 LLPs were registered in January, compared with 2,620 a year earlier.
Company float crosses 150,000-mark
The number of companies registered this fiscal has now breached the 1,50,000-mark for the first time to reach 151,442 until January, while that of LLPs stands at 47,800 and is poised to cross 50,000 in February.
Importantly, the record incorporation comes despite complaints of technical glitches involving the latest version of the MCA21 portal for corporate filings and amid a continued crackdown on shell companies.
Officials had earlier said the faster addition of LLPs is also driven by bright prospects of services exports, which have held up despite faltering goods shipments in the wake of a global growth slowdown.
Experts, too, have said advanced nations facing economic slowdown tend to divert a larger number of orders for services to destinations like India to trim costs, especially in segments like accountancy and legal services.
Services exports from India rose almost 3.5% to $247.9 billion in the first three quarters of this fiscal from a year before, while outbound merchandise shipments dropped 5.7% to $317.1 billion during the same period.
India’s economy will likely grow at 6.7% this fiscal year and 6.5% in the next, almost double the global average, the International Monetary Fund (IMF) said last month.
But as per the statistics ministry’s first advance estimate, India will grow at a higher-than-anticipated pace of 7.3% in FY24, making for three straight years of 7%-plus expansion despite global turmoil. The Reserve Bank of India has forecast a 7% economic growth for FY25.
