In the wake of govt’s plan to merge the existing NRI route with the FPI system as announced in Interim Budget 2019-20, the govt along with the Securities and Exchange Board of India (Sebi) is planning to create a third category of investors under the foreign portfolio investors (FPIs) system that will enable NRIs to invest in Indian markets, said an Economic Times report. The move will increase the involvement of NRIs in local markets, the report added. Currently, NRIs invest in India through the portfolio investment scheme (PIS) route, which is controlled by the Reserve Bank of India (RBI). As per the current rule, NRIs are allowed to invest only 5% in a listed company. After the merging of the two routes takes place, NRIs will be able to invest up to the maximum FPI limit in a company, which in most sectors is 100%. The move will also open up the local markets for the participation of NRI-dominated funds. This PIS route will continue to exist for NRIs to make non-market investments including fixed deposits (FDs) and recurring deposits (RDs).
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India is a vast country and a mystery to most. Those who live in it, those who now live outside of India or those who are just visiting. We, at NRIClub™, serve as a centralized hub of information for the residents, non-residents and travellers who are not familiar with various aspects of this great country.
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