Common directors- query

Dear all,

I have the following query :-

an indian company has two directors. Can these directors setup a company in dubai which will comprise of the same two directors as in india and do business with one another. 

Both the companies have the primary object of trade in agricutural products. 

What would the implications be in terms of companies act, income tax act, fema, ftp,rbi guidelines and any other relevant statute.