Investment on Non Repatriation Basis

Investment in Companies
NRIs, PIOs and OCBs can purchase share or convertible debentures (without any limit) on non-repatriation basis, of an Indian company issued by public issue or private placement or right issue. Howver there is an exception to this policy which says that the debentures or shares purchased should not belong to the following companies:

• Companies engaged in agricultural and plantation activities
• Companies in real estate business
• Companies engaged in the construction of farm houses
• Companies dealing in Transfer of Development Rights
• Nidhi companies and chit funds
  

Investment in Firms and Proprietary Concerns
Both NRIs and PIOs can invest by way of contribution to the capital of a firm or proprietary concern in India provided:

The amount can be invested through two mediums:

• By inward remittance through normal banking channels
• Out of permissible accounts maintained with an authorized dealer/bank.

However amount should not be invested in a firm or proprietary engaged in agricultural and plantation activity or real estate business. Investment in Firms and Proprietary Concerns shall not be eligible for repatriation.

Purchase and sale of securities other than shares or convertible debentures of an Indian company by NRIs and OCBs

A Non Resident Indian (NRIs) or an Overseas Corporate Body (OCB) may, without limit, purchase on non-repatriation basis:

• Units of Money Market Mutual Funds
• Non Convertible Debentures
• Commercial Papers (OCBs are not permitted)
• Make deposits with Companies
  

On a repatriation basis NRIs and OCBs can purchase

• Without limit, Government dated securities (other than bearer securities) or treasury bills domestic mutual funds units
• Public sector undertaking (PSU) Bonds in India.