As the name suggest VAT is tax on value addition and in your you will be liable for tax on 2% of value addition. I.e you will pay tax on 10200 Euro and take input of tax on 10000 euro.

India is the best option to invest and do business right now. You can consider following points: Cost: Cheap labour,cheap travel and other cost. Tax Efficiency: With implementation of GST 2 years back, tax complication is lower Foreign Friendliness: There is lot of unemployement in India and Goverment is promoting Make in India. So, there will be support from Govt. . Concerns: Law and order and red tapism which is being looked after by the Govt. If you are thinking of future India is the MARKET. I will help in getting it established.