The Saudi Arabian government has been introducing a series of reforms to attract foreign investments, and these changes have drawn significant interest, including from Indian investors. The country’s Vision 2030 plan aims to diversify the economy, placing a notable emphasis on encouraging foreign investments in the industrial sector.
Unlike earlier policies that allowed joint ventures with Saudi citizens in limited areas, the rules now permit full foreign ownership of businesses. Additionally, measures like long-term residency visas for investors are being implemented, echoing initiatives seen in countries like the UAE. These changes signal a shift from Saudi Arabia’s traditionally stringent legal framework to a more investor-friendly environment.
Many expatriates, including Malayalis residing in Saudi Arabia, are reportedly moving from work visas to business opportunities. The country’s market also offers export possibilities to Gulf and African nations, broadening the scope for business ventures. Various sectors are witnessing an uptick in opportunities, and individuals are exploring these new possibilities.
To start a business, the first step is obtaining primary approval from the Saudi Ministry of Investment (MISA or Wizarat al Alistithmar). The ministry provides detailed information about investment licenses, tax benefits, guarantees, and legal guidelines. Applications are submitted online, and the ministry’s website lists the sectors open to foreign investment along with their respective investment limits. These investments can be shown as cash or assets such as equipment.
Applicants must provide a detailed business plan covering the nature of the business, objectives, anticipated revenues, and relevant personal documents, including a passport. Documents proving the value of assets or company equipment are also required.
Special visas and residence permits for investors can be applied for alongside company registration. Local banks have dedicated schemes for opening accounts tailored to investors. Visa options include annual renewable limited-term visas, lifetime residency permits, entrepreneur visas for startups, real estate residency permits for property developers, and talent residency permits for professionals in arts, culture, and sports. Notably, investments must be made under the name of a company rather than an individual, and the naturalisation rules for hiring Saudi nationals in various roles are mandatory.
After securing the investment license, other sector-specific licenses may be necessary. These include commercial licenses from the Ministry of Commerce, professional licenses for fields like law and engineering, and health licenses for businesses in the healthcare sector. Value-added tax (VAT) and Zakat registrations must also be completed once the business starts generating income beyond certain thresholds. Applications for these can also be processed online.
Zakat is subject to any activity intended to earn money or work, so once registered with the Ministry of Commerce, TIN is created for the business. Once established, you will need to log in to the General Authority of Zakat and Tax portal to complete the initial registration at the Zakat services.
Saudi Arabia is focusing on attracting foreign investments in areas such as real estate, information technology, renewable energy, biotechnology, health, tourism and hospitality, mining, and logistics. Investors can also explore opportunities in special economic zones in major cities like Riyadh and Jeddah. Programs initiated by the Saudi Arabian SME Authority support startups with financial aid, co-working spaces, and business mentoring.
The required documents for an investment license typically include a notarised board resolution with details of business partners and their capital shares, audited financial statements for the last year (for existing companies), articles of association, passports of shareholders, identity and address proof for directors and shareholders, and a certified power of attorney. Many government-approved agencies in Saudi Arabia offer services to assist with company registration and licensing. Investors can also opt to submit their applications through these agencies.
