For information of members who have their children abroad. May be some of u
know about it.
*Investment Options in India for NRIs/PIOs/OCBs*
NRI Investment in India offers better-than- expected choices as well as
opportunities to make high profits. A diversified domestic industrial base,
banking infrastructure, and financial services, and real estate growth
continue to add to its magnetic charm.
Government of India is offering several facilities to Non Resident Indians
(NRIs), Persons of Indian Origin (PIO) and Overseas Corporate Bodies (OCBs).
While NRI refers to an Indian citizen who is residing outside India , PIO
refers to an individual who at any time held an Indian passport or whose
father or grandfather was a citizen of India .
*Bank Accounts:* NRIs/PIOs/OCBs/ are permitted to open bank accounts in
India out of funds remitted from abroad with the foreign exchange brought in
from abroad or out of funds is legitimately due to them in India, with
authorized dealer.
The Reserve Bank of India (RBI) has also granted general permission to
NRIs/PIOs, for undertaking direct investments in Indian companies, under the
Automatic Route purchase of shares under the following schemes:
1) Portfolio Investment Scheme,
2) Investment in companies and
3) Proprietorship/ partnership concerns on non-repatriation basis
4) For remittances of current income.
*Please Note:*
Ø NRIs/PIOs do not have to seek specific permission for approved
activities under these schemes.
Ø *NRIs/PIOs/OCBs can avail Direct Investment Opportunities through*:
ü *Automatic Route of RBI (With Repatriation Benefits):*NRIs/OCBs can
invest in shares/convertible debentures of Indian companies under the
Automatic Route without obtaining Government or RBI permission except for a
few sectors where FIPB/SIA permission is necessary, or where the investment
can be made only up to a certain percentage of paid up capital.
ü *Investment with Government Approval:* Investments not eligible
under the Automatic Route are considered by the Foreign Investment Promotion
Board (FIPB) subject to sectoral limits/norms. These investments also enjoy
full repatriation benefits.
ü *Other Investments (with Repatriation Benefits):*
§ Investment in Domestic Mutual Funds
§ Investment in Bonds Issued By Public Sector Undertakings
§ Purchase of Shares Of Public Sector Enterprises (By
NRIs/PIOs/OCBs)
§ Deposits with Companies (For A Minimum Period Of Three Years)
§ Investment in Government Securities/Shares
ü *Investment Upto 100% Equity (without Repatriation Benefits):*
* *
§ NRIs can invest by way of capital contribution in any proprietary
or partnership concern in India provided the firm or the proprietary concern
is not engaged in any agricultural or plantation activities or real estate
business or Print Media on non-repatriation basis subject to the certain
conditions.
§ NRIs/OCBs has been granted general permission to subscribe to:
- the shares/convertible debentures of an Indian company on
non-repatriation basis,
- An Indian company to issue shares or convertible debentures by way of
new/rights/bonus issue to NRIs/OCBs on non-repatriation
basis provided that
the investee company is not engaged in agricultural or
plantation activities
or real estate business (excluding real estate development
i.e. development
of property or construction of houses) or chit fund or is
not a Nidhi
company.
ü *Other Investments (without Repatriation Benefits)*
* *
· Investment in Non Convertible Debentures
· Money Market Mutual Funds
· Deposits With Companies
· Commercial Papers (OCBs are presently not permitted)
· Investment options in India
· NRIs have been provided with multitude of investment options in
India :
ü *FCNR Accounts:*
NRIs are permitted to open foreign currency (FCNR) account which can be
opened in five major currencies, viz., US Dollar, Pound Sterling, Deutsche
Mark, Euro and Japanese Yen. These accounts are opened for periods ranging
from 12 months to 3 years. FCNR accounts may be opened with a remittance in
the designated currency received from abroad or by conversion of a
remittance in any other convertible foreign currency into the designated
currency at the risk and cost of the customer. On maturity, payment shall be
made in foreign currency/Indian Rupees, as desired by the depositor.
ü *RFC Accounts:*
NRIs are eligible to maintain Resident Foreign currency (RFC) accounts.
These accounts can be held singly or jointly in the names of eligible
persons. Such accounts can be maintained in the form of savings bank,
current accounts and term deposits.
ü *Term deposit accounts:*
Term deposits can be opened by remittances from abroad or by transfer of
funds from existing NRE/FCNR/NRO/ NRSR accounts of the same person with
other banks in India or from other branches of the bank or by tendering
foreign currency notes/ travelers cheques brought by NRI's during their
visit to India .
ü *Non-resident Non-repatriable Rupee Deposit Scheme:*
These accounts can be opened by way of transfer of funds from abroad or from
existing NRE/FCNR accounts. Deposits period ranges from 6 months to 3 years
and the deposits are maintained in Indian Rupees only on a non-repatriable
basis.
ü *Non-Repatriable Deposit Accounts (NRO):*
The local funds of an NRI viz, rent, dividend, interest, sale proceeds of
securities, property, etc. can be credited to these accounts and balances
can also be placed in term deposits. Incomes earned on investments done on
non-repatriable basis are to be credited to NRO account. After completion of
formalities, eligible amount can be repatriated.
ü *Special term deposit accounts:*
These are reinvestment deposits.. Interest earned on these deposits are
added to the principal and compounded at quarterly intervals. The principal
amount together with interest is repaid on maturity of the deposit.
ü *Cash certificates*:**
All conditions pertaining to Special Term deposits are applicable for Cash
Certificate Deposits.
*Thrift Deposit Scheme:*
It is a recurring deposit scheme where fixed sums are deposited every month
for a fixed period. Compound interest is payable at the same rates as
applicable to other term deposits. Loan facility is also available.
ü *Unit Deposit:*
It is a fixed deposit scheme wherein you can withdraw your deposit to the
extent of your need and leave the remaining amount undisturbed to earn you
interest at the contracted rate.
ü *Miscellaneous:* Apart from these NRIs are permitted to make direct
investments in proprietary/ partnership concerns in India as also in
shares/debentures of Indian companies. They are also permitted to make
portfolio investments i.e. purchase of shares/debentures of Indian companies
through stock exchanges in India . These facilities are granted both on
repatriation and non repatriation basis.**
