In plain words: NRIs are keen to invest back home — but the route matters, and getting it wrong can block repatriation later. Here is how an NRI invests in India correctly.
Repatriable vs non-repatriable
The first choice shapes everything. Investing on a repatriable basis (funded from NRE/FCNR or inward remittance) lets you take the money back abroad later. On a non-repatriable basis (funded from NRO) the investment and returns stay within the NRO framework.
Listed shares: the PIS route
To buy and sell listed shares on a stock exchange, an NRI typically uses the Portfolio Investment Scheme (PIS) — a designated bank account linked to a demat and trading account, through which trades are routed and monitored for the applicable limits.
Mutual funds
- NRIs can invest in Indian mutual funds on a repatriable or non-repatriable basis, using NRE/NRO funds.
- Some fund houses have restrictions for NRIs in certain countries (a compliance, not FEMA, point).
Bonds, deposits and other instruments
- Government securities and bonds, and corporate deposits, are available within the NRI routes.
- Watch any sector or scheme-specific conditions and caps.
The accounts you will use
- NRE / inward remittance → repatriable investment.
- NRO → non-repatriable investment.
- A PIS account for exchange-traded shares.
Frequently asked questions
What is PIS? The Portfolio Investment Scheme route for NRIs to trade listed Indian shares through a designated account.
Can I repatriate my gains? If you invested on a repatriable basis, yes — within the rules.
Can NRIs buy Indian mutual funds? Yes — repatriable or non-repatriable, with some country restrictions by fund houses.
How Vakil Help Desk helps
Vakil Help Desk advises on FEMA compliance, NRI and foreign-national matters, foreign investment and compounding — and represents clients in ED FEMA proceedings. If you have a cross-border transaction or a FEMA question, we can help you get it right.
This article is for general legal awareness, not individual legal advice. FEMA rules, limits and forms are revised by the RBI and the Government from time to time, and the right treatment depends on your facts and the current position. Please consult a professional before acting on a cross-border transaction.