NRIs with less experience in international investing can choose mutual funds for better returns. Tax on investments in mutual funds is not applied if and only if India and the country of residence sign a Double Taxation Avoidance Agreement (DTAA
These are the best choice for NRIs who are risk-taking investors. Within the Reserve Bank of India’s portfolio investment scheme, NRIs can readily invest in the Indian stock market. NRIs must have an NRE/NRO bank account, a Demat account, and a trading account.
The Indian Stock Exchanges list gold exchange traded funds, or gold ETFs, in which NRIs can invest. As per FEMA guidelines, NRIs are required to open a Portfolio Investment NRI Scheme (PINS) Account before investing in Gold ETFs.
NRIs are allowed to own or purchase property in India as long as they follow the FEMA (Foreign Exchange Management Act) regulations. Investing in commercial property in India can offer NRIs substantial rental yields.
NRIs are eligible to open FCNR, NRE, and NRO FDs. On NRE and FCNR FDs, they are permitted to receive interest income without paying taxes; however, interest on NRO FDs is subject to taxation in India. NRO Fixed Deposits have restricted repatriation compared to FCNR and NRE FDs, which are fully-repatriable.
The Indian government provides the Public Provident Fund (PPF), a well-liked long-term savings and investment option. It is a suitable investment choice for those who live overseas and want to invest in India.
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