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NRI investment opportunities, plans and scope in India, where should NRI invest

Posted Date: 08 Oct 2011 |Updated: 08-Oct-2011 |Category: NRI Investments |Author: |Member Level: Gold |Points: 25 (Rs12) |


India is now getting ‘brain gain’ instead of ‘brain drain’. But this gave birth to the need of smart investment plans in India. If you are also thinking to come back to your nation then you must know the investment scope in India for NRI as mentioned here.

Indian economy has got acceleration with convenient migration facilities. On the one hand, people are facing towards abroad to feel an international experience. On the other hand, many Indians are coming back to their nation due to recession in western countries. Such movement give birth to some issues like if an Indian stays outside India for a long time period then he is ranked as Non Resident Indian or NRI, then the question arises that what would be the position of NRI in Indian investment and what about his investments in foreign country?



The regulations of investments are under Indian Exchange Control Law which are prepared under Foreign Exchange Management Act (FEMA). These are approved by Reserve Bank of India (RBI). The scope of FEMA is that it covers investment in securities, Foreign Direct Investment (FDI), government bonds, shares, units, bank deposits, foreign exchange and immovable property on a large scale. Also, this act has comprehensive notifications and circulars. One of these categories determines the investment rules for an individual. Under FEMA, residency status of NRI is the base of allowed investment targets and this status is determined according to the motive of an individual. It also depends upon his number of days spent in last year. Presently, its limit is 182 days.

NRI eligibility criteria


The eligibility for NRI or Indian resident is a mater of fact based analysis. India is still not completely around capital account convertibility. Although, NRIs returning back to India get some concessions on existing foreign assets. The benefits to NRI returning India are as follow:
  • Any purchased, hold or owned foreign currency, foreign security or immoveable property of any person, or any asset received from a person who is not a resident of India, during his (NRI) stay in abroad, will be permanently owned by him (NRI) even after his return to India. But there is no special provision for assets like jewellery, motor vehicle or personal household.

  • It is mandatory to bring income back to India from such foreign asset. You may also consider on credit of Resident Foreign Currency (RFC) account and it can be analyzed. RFC account is completely restriction free in terms of usage of foreign currency dues.

  • As far as maintenance of foreign bank account is concerned, then it is mandatory for NRIs returning back to India to seek permission from RBI for maintenance of foreign bank account.


Another important thing to be considered by NRIs on returning back to India is to re-settle in India and re-determination of bank accounts after being an Indian citizen. Generally, banks do so when you get evidence about their settlement in India. Another question arises of their investment in India. Such NRIs have unlimited investment opportunities in India.

NRIs investment plans in India


Some of the investment opportunities for NRIs in India as well scope for NRI investment are as follow:
  • NRI can do unrestricted investment in government securities, UTI, National Saving Certificates, shares and mutual funds.

  • NRI can invest in equity shares or CCPS or CCD of any company in FDI scheme on the repatriation basis.

  • Such NRIs who are citizens of India, can purchase an immovable property in India, provided that such property is not agricultural land, plantation or farm house. The purchase can be done via capital brought in India through normal banking channels or via asset deposited in any special Indian account.

  • Loan can be taken for the purchase of accommodation from an Indian employer or official dealer.

  • NRI can freely invest in any partnership or proprietorship firm but such partnership or proprietorship firm should not be involved in agriculture, plantation or real estate.




  • They can transfer or sell shares and debentures. Transfer of commercial or residential property can also be permitted with certain conditions.

  • Maximum 10 lakh dollars from such sale can be send abroad from general account of NRI.


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