Everything You Wanted To Know About NRI Trading?

While the world tumbled into crisis during the 2008 financial crisis, India struck out as an economy which stood strong and grew. One of the world’s top emerging economies, India has steadily attracted investments from foreigners and NRIs as well.
For quite some time, NRI trading has taken center stage. While they stay outside India, the Indian diaspora has seen the advantages of India’s economic prowess. If you are one of them reading this or know someone interested in trading in India, here’s everything you need to know.

1.    Can NRIs invest in shares via stock exchanges?
NRIs are eligible to purchase shares of Indian companies listed on stock exchanges but only through the Portfolio Investment Scheme (PIS).
 
2.    Do NRIs need to open a new account to trade?
Yes, to trade in Indian stock markets, one needs to visit the branch of an authorized dealer to administer the PIS and open a NRE/NRO account.
 
3.    What are the documents required to open an account?
Here’s a list of mandatory documents required:
·       Passport Copy
·       Valid Visa
·       In case of foreign passport: Place of Birth as India in foreign passport, Copy of PIO/OCI Card.
·       PIS permission letter from designated bank
·       PAN Card
·       Overseas Address Proof
·       Proof of bank accounts and depository accounts
 
4.    Is there a limit on purchase?
Yes, as per RBI guidelines, an NRI can purchase a maximum of up to 5% of the aggregate paid up capital of the company.
 
5.    Can NRIs Invest in other securities?
Yes, NRIs can invest in:
·       Dated government securities or treasury bills
·       Units of domestic mutual funds
·       PSU issued bonds
·       Public Sector Enterprise shares disinvested by Government of India
 
As you can see, even if you are an NRI, you can trade in India with ease. The documentation process is simple and most banks and firms have gone out of their way to ensure you do not face any hassles.

India’s economy looks stable compared to most world economies. It is set for a good run, why don’t you invest and take advantage of the upswing?