Indian company laws aren't very startup friendly. Also, if you are looking to raise investment from a US based VC, they are much more comfortable in investing i

Indian company laws aren't very startup friendly. Also, if you are looking to raise investment from a US based VC, they are much more comfortable in investing in an environment they know better. Also, there are quite specific advantages of incorporating in USA. Indian payment gateway providers don't offer the same set of features that the Western providers do. This may have changed lately as more payment startups have started in India. PS: This is based on what I hear from founders at various conferences in Bangalore, and not on first-hand experience.