Betting on India: LLPs surge 54% in first 3 quarters

New Delhi: The number of limited liability partnerships (LLPs) incorporated in the first three quarters of FY24 surged about 54% year on year, far outpacing an over 4% rise in the registration of companies during the same period, official data show.

The LLP numbers are boosted by robust prospects of services exports, which have held up despite faltering goods shipments in the wake of a global growth slowdown, a senior government official said.

Also, domestic services trade has rebounded this fiscal, the person added. The data from the Ministry of Corporate Affairs (MCA) showed 42,524 LLPs and 137,109 companies were registered between April and December this fiscal, both scaling fresh highs.


The record incorporation reflects growing optimism about India’s growth prospects despite the external turmoil, said the official. It 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.

Services Export Promotion Council (SEPC) chairman Sunil Talati had earlier said the ongoing slowdown in advanced nations could bolster India’s services export prospects as these economies tend to divert a larger number of orders to destinations like India to trim costs, especially in segments like accountancy and legal services.

Services exports from India rose almost 6% to $220.7 billion until November this fiscal from a year before, while outbound merchandise shipments dropped 6.5% to $278.8 billion during the same period. The rise in services exports came on top of record despatches exceeding $320 billion last fiscal.

India would remain the world’s fastest-growing major economy with an expansion of 6.3% in both this fiscal year and the next, more than double the global averages, according to the International Monetary Fund (IMF).

The Indian government, however, expects the FY24 growth rate to exceed 6.5% due to the higher-than-anticipated 7.6% expansion in the September quarter.

One reason for the emergence of a large number of companies and LLPs is the government’s efforts to reduce India Inc’s compliance burden, decriminalise several minor offences, and remove redundant laws, officials said.

Finance and corporate affairs minister Nirmala Sitharaman had in September said the current NDA government had scrapped 39,000 unnecessary compliances and 1,500 archaic laws. The elevated incorporation of companies and LLPs also indicate strong prospects of goods and services consumption.

India’s emergence as a “bright spot” amid the global turbulence is also adding to the confidence of entrepreneurs, analysts said. Also, investors seem to be mindful of the ongoing changes in the global supply chain, with focus on alternatives to China, they added.