By Prarthana Mitra
If you’re a Non-Resident Indian (NRI) with an RBI-authorised bank account, you’re in luck! Under the central bank’s Portfolio Investment Scheme (PIS), NRIs can now invest in the Indian stock markets if the designated branch of their bank has the license to facilitate such investments.
Here’s what it entails
As per the scheme, all NRIs, even Overseas Corporate Bodies (OCBs) can trade in shares and convertible debentures of Indian companies on a recognised stock exchange platform, by routing their transactions for such purchase and sale through bank accounts with an authorised and designated branch.
Chief Executive Officer of ClearTax, Archit Gupta, writes for Mint, saying, NRIs who are in the process of converting their resident demat accounts to non-resident demat accounts before leaving the country, should contact their banks to find out if that particular branch is authorised by RBI to buy all existing investments made in demat mode.
Banks will be able to clarify details about the due process and time taken for the conversion, especially in the interim period before emigration.
Why you should care
Perhaps the best news comes for those who have left the country but still want a share of the Indian stock trading.
The PIS will enable NRIs to invest in Indian companies on a repatriation or non-repatriation basis through a registered stock broker or a recognised stock exchange, from any corner of the world. Most banks, including HDFC, ICICI, Axis Bank allow portfolio investments through specialised accounts, as do public sector banks like the State Bank of India.
As per the scheme, you can also transfer all holdings in your existing demat account to your NRI demat account, without having to sell them. The new policy not only encourages trade but also enables NRIs to act as influencers and partakers of the country’s economy.
Prarthana Mitra is a staff writer at Qrius