NRIs have broad investment access in India, with a few specific restrictions. This chapter is the map.

Mutual funds

Allowed: Almost all Indian mutual funds — equity, debt, hybrid, ELSS, index, FoF.

Restricted: Many fund houses do not accept investments from US and Canada-based NRIs due to FATCA / regulatory cost. Roughly 8-10 AMCs accept US/Canada NRIs — Aditya Birla SunLife, ICICI Prudential, Kotak, L&T, SBI, UTI, PPFAS, Sundaram are typically open (subject to change; verify before applying).

KYC: NRI KYC required, including FATCA declaration if applicable. Investments must be from NRE or NRO bank account.

Repatriation: Investments from NRE — fully repatriable redemptions. From NRO — within USD 1M/FY cap.

Direct equity

Allowed: Cash market equity in any listed company, subject to PIS / non-PIS route.

Restricted:

• Cannot do intraday equity trading (must take delivery)
• Cannot trade in commodities (with limited exceptions)
• Cannot trade in currency derivatives
• F&O is allowed on a non-repatriation basis only, via NRO PIS

Bonds and debentures

• Government bonds (G-Secs, T-Bills) — allowed via RBI Retail Direct or NRE bank route
• Corporate bonds (listed) — allowed, similar to equity
• Tax-free bonds, SDLs — allowed
• NCDs — allowed

Fixed deposits

• NRE FD — rupee, tax-free, fully repatriable
• NRO FD — rupee, taxable, partial repatriation
• FCNR FD — foreign currency, tax-free, no exchange risk

Real estate

Allowed: Residential and commercial properties anywhere in India.

Not allowed: Agricultural land, plantation property, and farmhouses. NRIs cannot buy these even from another NRI. Inheritance of such properties is permitted but onward sale is restricted to resident Indians.

Payment: Must be from NRE / NRO / FCNR or normal banking channels — no cash.

Loans: Indian banks happily lend home loans to NRIs, typically up to 80% LTV, EMIs payable from NRE/NRO.

Government small savings — what NRIs CANNOT do

NRIs are not eligible to open new accounts in:

• PPF (existing PPF accounts opened while resident can continue to maturity, but cannot be extended)
• NSC, KVP
• Senior Citizen Savings Scheme
• Sukanya Samriddhi (existing accounts can continue if the girl was Indian resident at opening)
• Post Office Monthly Income Scheme

Insurance

• Term insurance — most Indian insurers offer NRI plans, premiums payable from NRE/NRO
• Health insurance — coverage usually only valid for treatment in India; some insurers offer worldwide cover variants
• ULIPs and endowment — allowed, but tax-inefficient and rarely optimal for NRIs

NPS

NRIs can open NPS Tier-1 accounts, with the same tax benefits as residents (only relevant if they file Indian returns under old regime).

US stocks via LRS (relevant for residents, not NRIs)

This is the inverse case — Indian residents investing abroad. Under the RBI Liberalised Remittance Scheme (LRS), an Indian resident can remit up to USD 250,000 per financial year for permitted current and capital account transactions, including:

• Purchase of US stocks via Indian brokers offering global access (INDmoney, Vested, Groww Global, etc.) or international brokers (Interactive Brokers)
• Investment in US ETFs, REITs, mutual funds
• Education, travel, gift, medical, etc.

TCS (Tax Collected at Source) at 20% applies on LRS remittances above ₹10 lakh per year for non-education / non-medical purposes. The TCS is fully claimable as advance tax credit when filing your ITR.

NRIs investing in US stocks

NRIs in the US directly hold US securities — no LRS applicable. NRIs elsewhere can open US brokerage accounts (Charles Schwab International, IBKR) or use Indian platforms with global access. India does not regulate this outflow; the host country's rules apply.

GIFT City IFSC — preview

NRIs have a powerful additional option through GIFT City — covered in detail in Chapter 6. Briefly, GIFT City IFSC allows NRIs to invest in USD-denominated funds, structures, and securities with tax efficiencies not available domestically.

Next chapter: how all of this gets taxed.