NRI & Indian Stock Market: Rules You Must Know
NRIs can invest in the Indian stock market—but only if the structure and compliance are done correctly. One mistake can trigger FEMA violations and tax issues.
How NRIs Invest in Indian Shares
1. The PIS Route (Mandatory)
NRIs must invest through the Portfolio Investment Scheme (PIS):
- Open a PIS account via an RBI-approved Authorized Dealer (AD) bank
- Every buy and sell is reported to the RBI through this route
- Ensures regulatory tracking and FEMA compliance
2. NRE vs NRO Trading Accounts
Choosing the right account determines repatriation eligibility:
- NRE PIS Account
- Fully repatriable
- Profits can be transferred abroad
- NRO PIS Account
- Non-repatriable
- Funds remain in India (subject to limited remittance rules)
Critical Rules NRIs Must Follow
- Maintain separate demat & trading accounts for NRE and NRO
- Do not use a resident demat account after becoming an NRI
- Ensure accurate reporting of all holdings for tax and compliance purposes
- All trades must route only through PIS-linked accounts
Even one trade executed through a resident account after NRI status can result in a FEMA breach.
How NS Global Consultants Pte Ltd Helps
We ensure end-to-end NRI investment compliance, including:
- PIS & account setup
- Broker & bank coordination
- FEMA, RBI & tax compliance review