NRI Zone


What do mean by Non-Resident Indian (NRI)?

The Non-Residential Indian is an individual who fulfills the following criteria as per the Foreign Exchange Regulation Act of the year 1973:
  • The individual who holds an Indian citizenship but is abroad for the purpose of employment, vocation or any kind of legal business out to any other country outside India indicating an indefinite or prolonged stay in that country.
  • The Government employee of India who have been posted abroad for official duties with the missions for the country of India.
  • Indian Government employed individuals who have been employed in the international agencies like the World Health Organization (WHO), World Bank etc.
  • The Indian Government employed who have been posted temporarily in the branch offices abroad at any country outside India.

Define the person with Indian origin?

Any of the foreign citizens can be considered to be of Indian origin if: The concerned individual holds valid Indian passport. The concerned individual’s father or grandfather was a citizen of India as per the Constitution of India or by the Citizenship Act of 1955. This, however, do not apply to citizens of Nepal. Pakistan, Bangladesh, Afghanistan, Bhutan and Sri Lanka.

What is OCB?

Overseas Corporate Bodies (OCBs) are always possessed by the individuals having Indian citizenship and include the various companies’ partnerships companies, societies and any kind of the corporate bodies with an extent of 60% of the individuals being of Indian nationality.

Can the Overseas Corporate Bodies (OCBs) or NRIs invest in any property in India?

The investment of the NRIs and OCBs are legally allowed through two routes. One through the means of RBI and the other by the means of Government of India i.e. through the Foreign Investment Promotion Board (FIPB).

The OBCs and NRIs are allowed to make 100% equity investment in the sectors of real estate and civil aviation.

Investment made by the NRIs and OCBs are fully repatriable except for the investment in the real estates which has a minimum of 3 years lock-in period.

For the investments which do not fall in the usual route, special permission is required from FIPB before investing.

Do the foreign citizens of Indian origin require any special permission to purchase immovable property in India for residential purposes?

No, the foreign citizens of Indian origin do not require any special permission to purchase immovable property in India other than the purposes of agriculture, plantation or farmhouse.

What are the ways of sending the remittances to India?

The remittances can be sent to India through the normal banking channels.

Please specify the rates of remittances applicable in foreign currencies which are made by NRIs?

The remittances can be done as per the prevailing market rate of exchange less the bank charges if applicable.

What do you mean by the Foreign Exchanges Management Act (FEMA)? Can a person belonging to Indian origin residing outside India gift an earlier acquired property to someone?

Residential status and nature of the transaction which may be the investments in the property or capital markets may or may not require permission from RBI as the case maybe.

Yes, a person belonging to Indian origin residing outside India may gift a property to a person who holds an Indian citizenship. The concerned individual may also gift lands for agriculture, farmhouses to an Indian citizen.

Under the general purchasing norms, how would a foreign resident belonging to Indian origin pay for the residential immovable properties purchased in India?

The payment can be done as per the prevailing rates of foreign exchange through normal banking channels or through the funds from the NTC/FCNR accounts which have been maintained by the concerned individual in any Indian bank.

What are the major formalities which are to be fulfilled for the purchasing of normal immovable residential property in India by a foreign resident of Indian origin?

In such a case, the concerned individual who is purchasing the immovable residential property in India may file a formal declaration in form IPI 7 within 30 days of purchasing the property or within 30 days of final payment being done.

Is it possible to sell such a property without the permission of Reserve Bank of India?

Yes, RBI has permitted the selling of such property without any special permission from RBI. Only in case, the property is being sold to any other foreign resident of Indian origin, the payment has to be remitted to India or paid out of the funds that are already there in FCNR/NRE accounts.

Is it necessary to fulfill any conditions if repatriation of sales proceeds is desired?

Application for the repatriation of sales proceeds can be made provided the sales take place after three years from the date of the final purchasing deed or from the date of the final installment of the considered amount.

Please explain the procedure for seeking of such repatriation.

Application is required for the necessary permission of remittance that is to be made from IPI 8 to the Central Office of the Reserve Bank in Mumbai within ninety days of the sale of the property.

Can any authorized dealer offer a loan to a NRI for the purchase of a residential flat or house in India?

Authorized dealers are permitted to grant loans to NRIs for the acquisition of a flat or a house in India but subjected to certain conditions. Repayment of the loan can to be done within a maximum period of 15 years as per the norms.

Can these funds be repatriated?

Yes, the funds can be repatriated provided the fact the funds have been remitted from abroad or have been debited from FCNR/NRE account.

Can NRE/NRO accounts be jointly maintained by an NRI along with a partner who is a resident Indian?

NRO accounts can be held jointly by a NRI along with a resident Indian. However, the resident Indian has to operate with the instruction of "Former or Survivor".

Is any interest earned out of the property taxable?

Mere owning of the property is not taxable. However, any kind of steady income that is done through the renting of the property or by any other means is taxable.