The following information is provided for general information only. However, in view of the individual nature of the implications, each investor is advised to consult case to case basis with respect to the specific tax and other implications arising out of his or her participation in the scheme.
A non-resident Indian (NRI) is an Indian citizen or a person of Indian origin who stays abroad for employment / carrying on business or vocation outside India or stays abroad under circumstances indicating an uncertain duration of stay abroad.
A Person of Indian Origin means a citizen of any country (other than Bangladesh or Pakistan), if:
- He at any time held an Indian passport; or
- He or either of his parents or grandparents was a citizen of India; or
- He is a spouse of an Indian citizen, or of a person referred to in (a) or (b) above.
Yes. NRIs can maintain accounts in rupees as well as in foreign currency. Accounts in foreign currencies can, however be maintained with authorised dealers only.
Two types of rupee accounts viz.
- NRE: Non-resident (External) Rupee Accounts
- NRO: Non-resident Rupee (Ordinary) Accounts
- Non-Resident (External) Rupee (NRE) account is a Rupee account from which funds are freely repatriable. It can be opened with either funds remitted from abroad or local funds which can be remitted abroad.
- Non-Resident Ordinary Rupee (NRO) account is a Rupee account and can be opened with funds either remitted from abroad or generated in India. The amounts in such account are generally non repatriable. However, funds in NRO accounts can be repatriated subject to /a s per per various directives in force at the time of repatriation. More details can be found on RBI website www.rbi.org.in
NRI can invest in the following products.
- Equity trading on BSE and NSE
- Derivatives trading on the NSE
- IPO online
- Portfolio Management
- Investments in Mutual Funds
- An NRI should open a new bank account (NRE/NRO or both) with designated bank which is approved by RBI (Reserve Bank of India) for this purpose.
- He should apply for a general approval for investment in Indian Stock Market through his designated bank branch.
- He should open a Demat Account with an NBFC to hold his shares and register to execute his buy/sell orders on the stock exchange(s).
- NRI & FIIs can invest in mutual funds in India.
- OCBs cannot invest in mutual funds in India.
No special approval is required. NRIs/FIIs have been granted a general permission by RBI [Schedule 5 of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000] for investing in /redeeming units of the schemes subject to conditions set out in the aforesaid regulations.
However, PIOs need to attach a copy of the PIO card with the application form at the time of investing.
PIO Cards are issued by Ministry of External Affairs (CPV Division), Government of India to persons of Indian origin through Indian missions abroad. Specific information on rules, forms, particular offices, missions is available on the website http://www.passport.nic.in