the real estate market in India slated to multiply four fold
by 2010 to $45-50 billion, it is not surprising that foreign
investors are eager to share the gains from an investment in
Non-Resident Indians (NRIs) and Persons of Indian Origin
(PIO), investment in Indian real estate is monetarily
rewarding and emotionally gratifying, as it helps maintain
bonds with their homeland. The Reserve Bank of India (RBI) has
relaxed norms and issued simple guidelines for the convenience
of NRIs and PIOs wishing to invest in Indian realty under the
provisions of the Foreign Exchange Management Act,
and PIOs can acquire residential and commercial property in
India, though holding agricultural land, plantations and
farmhouses is not allowed by the Government of India. Resident
Indians owning such property must inform the RBI if and when
they acquire citizenship of another country.
and PIOs are also eligible to inherit or be gifted property in
India, and in turn, can sell, gift or transfer such immovable
assets to resident Indians, NRIs or PIOs.
persons of Indian origin residing in Pakistan, Bangladesh,
China, Afghanistan, Iran, Nepal, Sri Lanka and Bhutan are not
permitted to own or acquire any kind of property in India.
PIOs in this category can only reside on rented property,
subject to a maximum lease of 5 years.
far as foreign direct investment goes, the Ministry of
Commerce and Industry relaxed its policies in March 2005, and
investment from NRIs falls within its purview. Barring a few
sectors, 100% investment is allowed under the automatic route
from foreign and/or NRI investors.
flows are welcomed in building up infrastructure in urban
locations, and Special Economic Zones, Export Oriented Units,
industrial parks, hardware and software technology parks have
been permitted under the automatic route for 100% investment.
NRIs and PIOs have been offered additional entry options to
invest in Indian firms or proprietary concerns on a
non-repatriation basis through their NRE account, FCNR account
or NRO account. In case they wish to avail of repatriation
benefits government approval is required for the
Immovable Property by Inheritance In
case of inheritance of agricultural land or plantation or farm
house property, the RBI has to be informed.
of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran,
Nepal or Bhutan are not permitted to acquire or transfer
property in India. Only a lease rental of less than 5 years is
allowed for such persons.