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NRI Investment

To attract foreign investment in India, Government is offering numerous facilities to Non Resident Indians (NRIs), Persons of Indian Origin (PIO) and Overseas Corporate Bodies (OCBs). NRIs/PIOs/OCBs/ are permitted to open bank accounts in India out of funds remitted from abroad, foreign exchange brought in from abroad or out of funds legitimately due to them in India, with authorized dealer. Reserve Bank has granted universal permission to NRIs/PIOs, for undertaking direct investments in Indian companies, under the Automatic Route purchase of shares under Portfolio Investment Scheme, investment in companies and proprietorship/partnership concerns on non-repatriation basis and for remittances of current income. NRIs/PIOs do not have to seek specific permission for approved activities under these schemes.

NRI Investment in India


NRI Investment in India is a positive step taken by our government to stabilize the national economy. The Reserve Bank of India has permitted the NRIs, Overseas Corporate Bodies (OCBs) and the Person of Indian Origin (PIOs) to make direct investments in the companies that have India origin. This is in alignment with the Automatic Route purchase of shares under the Portfolio Investment Scheme. In fact, this facility is extended to the companies which have partnership or proprietorship concerns as well.

NRI's are permitted to invest their funds in government securities or units of UTI through authorized dealers. NRI investments are also allowed in national savings certificates subject to the terms and conditions of the issue/sale of such certificates. NRI's are not allowed to invest in Kisan Vikas Patra or Indira Vikas Patra. Government securities can be generously transferred or sold provided it is arranged through an authorized dealer.Banks holding authorized licenses or banks authorized on behalf of the Reserve Bank can hold and maintain accounts in the names of NRIs. Non-resident Indians are allowed to sustain accounts in rupees, as well as foreign currencies. Accounts in foreign currencies can be maintained only with authorized dealers.

Authorized dealers are permitted to grant loans/overdrafts abroad to NRIs through overseas branches and correspondents. Authorized dealers are permitted to grant loans/overdrafts abroad to NRIs against the collateral shares or debentures of the Indian companies that they hold, provided that the concerned shares or debentures were acquired on a repatriation basis. The NRIs are allowed to make investments in new issues of shares/ convertible debentures of Indian companies under investment schemes such as 24% scheme, 40% scheme or 100% scheme. NRIs may also start to initiate several savings and investment strategies for their return to India (r2i).

The non-resident Indians should check out the following features before retuning to India:
  • Foreign exchange regulation
  • Tax laws of India
  • Insurance
  • Retirement
  • NRI banking