Nri Portfolio Investment

By Author: Kirthy Shetty
Total Articles: 2542
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With India emerging as one of the fastest growing economies and preferred investment destination an increasing number of Indians, Non Residents and foreign investors are taking advantage of the investment options in the country. Moreover, the Liberalized reform and revised FDI policy has expedited the investment process in India. And gone are the days when investors could directly participate in the capital markets, which has led to a trend of portfolio investment schemes.

As per the new policy, Non Resident Indian (NRIs) and Persons of Indian Origin (PIOs) can purchase/sell shares/convertible debentures of Indian companies on Stock Exchanges under Portfolio Investment Scheme only. If you're an NRI planning investment in equity shares, there are a number of Indian banks (with a designated branch by RBI) offering Portfolio Investment Schemes (PIS). This allows you to trade on shares of Indian companies, in secondary market, under repatriation or non-repatriation basis.

Some banks even offer an online investment option to NRI's which ensures easy trading from the comfort of your home. For a Portfolio Investment ...
... Scheme you can compare amongst various Indian banks for their minimum balance amount, services offered, and their market reputation. Along with banks, there are number of financial services companies in India (registered with SEBI) catering to investment needs of Non Resident Indian investors. These companies have an expertise in managing Portfolio investments and with their years of research and experience they identify the right investment opportunities based on your goals.

The sale proceeds of the repatriable investments can be credited to the NRE, NRO or other accounts of the Non Residents Indians whereas the sale proceeds of non-repatriable investment can only be credited to NRO accounts. Banks designated by the RBI can accept applications at branches located close to the nearest stock exchange. A Non Resident Indian can only operate the Portfolio Investment Scheme through a single, selected branch. For operating more than one branch, you need to have a special permission from the RBI.

If you're considering of taking up a Portfolio Investment Scheme, you would need to submit a number of documents along with the PIS from. These include RPI/NRI Form duly filled and signed with details of shares purchased from the primary market. Letter of Authority for operating the account and Nomination Form ‘DA-1'.Once you submit all the documents, you will receive a authorizing letter which conveys permission of the Bank to undertake Sale / Purchase of shares from the secondary market under PIS through a Broker registered with Stock Exchange.

Under Portfolio Investment Scheme, NRI's can invest on repatriation and non-repatriation basis. Also shares purchase from stock exchange under Portfolio Investment Scheme cannot be transferred in or outside India without prior approval of RBI. So, when going in for a Portfolio Investment with an Indian bank or financial services company, make sure that you check and compare the fee charges and most importantly, do a little research to know about company's reputation in the market. Portfolio Investment Schemes are a great way of making the most of your wealth and saving for future.

Kirthy Shetty,
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