Tax breaks, reforms, and returns: Why NRIs are banking big on India
Subscribe to enjoy similar stories. India is cementing its reputation as a prime destination for global investors, with inflows into NRI deposit schemes surging to $7.8 billion between April and August this year—more than double the figure from the same period last year. Non-resident Indians (NRIs) are increasingly drawn to opportunities ranging from equities and mutual funds to real estate and GIFT City’s tax-efficient investment avenues.
The Indian market offers diverse avenues for portfolio diversification, including alternative investments such as portfolio management services (PMS) and alternate investment funds (AIFs). Equity investments, for instance, have delivered an impressive average annual return of 15% over the past five years, outperforming most major economies. Mutual funds also remain a popular choice, providing professional management, diversification, and flexibility.
Through the portfolio investment scheme (PIS), NRIs can seamlessly trade in Indian equities via NRE or NRO accounts on recognised stock exchanges. Also read: NRI investing in Indian stocks? Know about TDS on capital gains The real estate sector further strengthens India’s investment appeal, offering stability and steady returns. Reforms like the Real Estate Regulation Act (RERA) and the Foreign Exchange Management Act (FEMA) have enhanced transparency and accessibility.
For many NRIs, factors such as India’s economic growth, USD-INR exchange rate movements, and an emotional connection to their homeland continue to drive interest in this asset class. The Union Budget 2024 introduced targeted tax reforms to streamline compliance and enhance the experience for NRI investors. These reforms address income earned both within and outside India,
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