python installing package with submodules

I have a custom project package with structure like:

 package-dir/
     mypackage/
         __init__.py
         submodule1/
              __init__.py
              testmodule.py
         main.py
     requirements.txt
     setup.py

using cd package-dir followed by $pip install -e . or pip install . as suggested by python-packaging as long as I access the package from package-dir

For example :

 $cd project-dir
 $pip install .

at this point this works:

 $python -c 'import mypackage; import submodule1'

but This does not work

 $ cd some-other-dir
 $ python -c 'import mypackage; import submodule1'
 Traceback (most recent call last):
 File "<stdin>", line 1, in <module>
 ImportError: No module named submodule1

How to install all the submodules?

also, if i check the package-dir/build/lib.linux-x86_64-2.7/mypackage dir, I only see the immediate files in mypackage/*.py and NO mypackage/submodule1

setup.py looks like:

from setuptools import setup
from pip.req import parse_requirements

reqs = parse_requirements('./requirements.txt', session=False)
install_requires = [str(ir.req) for ir in reqs]


def readme():
    with open('README.rst') as f:
        return f.read()

setup(name='mypackage',
      version='1.6.1',
      description='mypackage',
      long_description=readme(),
      classifiers=[

      ],
      keywords='',
      url='',
      author='',
      author_email='',
      license='Proprietary',
      packages=['mypackage'],
      package_dir={'mypackage': 'mypackage'},
      install_requires=install_requires,
      include_package_data=True,
      zip_safe=False,
      test_suite='nose.collector',
      tests_require=['nose'],
      entry_points={
          'console_scripts': ['mypackage=mypackage.run:run'],
      }
      )

setup.py is missing information about your package structure. You can enable auto-discovery by adding a line

setup(
    # ...
    packages=setuptools.find_packages(),
)

to it.