10 best Investment options in India for NRIs
Ideal investment plans for NRI in India
Why do Non-Resident Indians invest in India?
10 Best Investment Options in India for NRIs
June 6, 2025
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Investment opportunities are diverse in India, as the Indian government opens more doors for NRIs to invest in India, focusing on improving the country’s economic structure. NRI investment plans are specially designed for non-resident Indians (NRIs) to invest and diversify their wealth portfolio in the Indian market. The multitude of investment options offers NRIs flexibility in generating passive income and taking advantage of potential returns. With the growing economy, variety of assets, and instruments, choosing the ideal investment options in India for NRIs may be difficult without a bit of expert advice. Therefore, this comprehensive guide will explore everything you need to know about investing methods for NRIs in India.
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Ideal investment plans for NRI in India
There are various investment opportunities available in India for overseas citizens of India – promising growth, diversity, and robust returns. At the same time, NRIs can not invest in some of the investment schemes established in India due to regulatory restrictions. So, we have listed some of the investment schemes below which would assist you in making a better-informed choice.
1. Mutual funds
Mutual fund investment is acceptable for NRIs in Indian financial market. Investors can invest in equities, government bonds, and corporate bonds using a demat account facilitated by authorised financial institutions.
It offers diversification to spread across various assets, ensuring long-term benefits from mutual funds. NRIs can participate in mutual fund investments through their NRE or NRO accounts by creating a brokerage account.
Additionally, NRIs are required to adhere to regulatory compliance, tax implications, and KYC requirements to facilitate mutual fund investing. NRIs can invest in mutual funds through lump-sum investments or systematic investment plans to generate potential returns.
2. Equity investments
NRIs can invest in Indian stocks and other securities through the Portfolio Investment NRI Scheme (PINS), which is regulated by the Reserve Bank of India. Investors can purchase and trade in the listed securities on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
Investors need to reach authorised banks or any financial institutions governed by the RBI to facilitate PINS. Investors are required to open a Non-Resident External (NRE) or use their Non-Resident Ordinary (NRO) account under the Portfolio Investment NRI Scheme (PINS) to invest in equities. There will be no more banking-related transactions that can be made with these accounts.
The only kind of trades that investors can make are delivery-based trades. This means that NRIs cannot trade stocks till the next day based on the settlement cycle. which means NRIs can not engage in intraday trading.
3. Initial public offerings
IPO refers to the process of making a privately held company into a publicly listed one where anyone can invest in their equities. During the IPO the shares of the company are offered to the public at a pre-determined issue price which the public can apply for.
NRIs can apply for IPOs through national and private banks or the online platforms of registered brokers. NRIs can facilitate payments for IPOs through their NRE (Non-Resident External) or NRO (Non-Resident Ordinary) accounts in Indian Rupees (INR). NRIs must adhere to KYC documentation with an authorised broker in India, which involves verification of documents.
Furthermore, NRIs are required to comply with Foreign Exchange Management Act (FEMA) regulations and guidelines for both investments and repatriation.
4. Investments in Gold
There are multiple options to invest in gold available for Indian citizens as well as for NRIs. Historically, the price of gold has been rising in the global market, promising a potential return from it and and excellent resilience among the asset classes during economic turmoils. Investment in gold can be done by purchasing any form of gold, be it physical or digital
Gold investment options for NRIs in India are:
5. Fixed deposits
Indian residents living outside of India can invest in fixed deposits by selecting a reputed Indian bank that offers favourable interest rates and good customer service. Investors can open a fixed deposit account, depending on the type of FD and tenure.
Fixed deposits offer stable and guaranteed returns over a long-term investment period. Long-term fixed-deposit investments are low-risk against market fluctuations, making them ideal for investors with low-risk appetite to earn a return.
Investors must consider interest rates, tenure, withdrawal, tax implications, and regulatory compliance before starting fixed deposit investments.
There are three types of fixed deposit accounts NRIs can utilise for fixed deposits, which are given below:
6. Forex trading
Forex trading is the process of exchanging a country’s currency with another to make a profit. Non-resident Indians can engage in forex trading by adhering to the regulations and guidelines. While forex can be an investment option, it’s generally more suitable for experienced traders or those with a high-risk tolerance. Given the volatility and skill required many people diversify their portfolios by adding safer assets too alongside forex trading.
NRIs can participate in forex trading through their NRE (Non-Resident External) or NRO (Non-Resident Ordinary) accounts. Forex trading must be executed through brokers in compliance regarding transactions, documentation, and reporting, ensuring no complications.
7. Real estate
Real estate refers to the purchasing, selling, or managing of properties to make profits. NRIs can invest in residential and commercial properties in India.
NRIs are required to submit specific documents for the verification process while purchasing properties in India. Investments can only be made from funds remitted to India through NRE or NRO accounts.
NRIs renting real estate are subject to a thirty per cent tax; the remaining amount is then disbursed by FEMA regulations.
Real estate is an ideal option when it comes to NRI investment in India. Investors can earn potential returns by making informed decisions. Continuous updates on tax implications and the real estate market may help find better real estate investment opportunities.
8. Public provident fund
NRIs can facilitate a public provident fund investment plan if the account was opened before becoming an NRI. Investors can hold the account until it reaches maturity.
Investments and returns vary from banks to different financial institutions. The investment plan for NRIs works similarly to it for Indian citizens, where investors can assure a guaranteed return over a long time.
However, they cannot extend or hold the public provident fund account after it reaches maturity.
9. National pension scheme
The National Pension Scheme is a retirement planning scheme that operates by contributing a specific amount over a longer period. NRIs who wish to take early retirement can invest in this scheme. However, there are specific guidelines to be aware of.
The eligibility criteria for NRIs are:
NRIs can have the benefits of tax deductions under sections 80CCD(1) and 80CCD(1B). However, they can only withdraw 60% of the accumulated corpus of a lump sum, while 40% of it must be used to purchase the annuity from PFRDA (Pension Fund Regulatory and Development Authority).
10. Corporate bonds
NRIs investing in India can also opt for corporate bonds issued by Indian companies through NRE or NRO accounts based on whether they wish for repatriable or non-repatriable bonds.
Both principal amounts and returns can be repatriated freely outside of India when investments are made through NRE accounts. However, the FEMA Act places restrictions on the conditions and limitations that must be followed for investments made in NRO accounts to be repatriated.
NRIs should be mindful of the tax implications in their country of residence as well as the currency fluctuations between the INR and their home currency. Guidance and ongoing education may help navigate the regulatory requirements to maximise profits.
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Why do Non-Resident Indians invest in India?
India has an emerging economy with the development of technologies and infrastructure, offering a wide range of assets to invest in for investors from India as well as abroad. Moreover, having a sizable population of around 140 crores too a decent portion of them are youth who are productive and part of the labour force which makes India an attractive destination for both domestic as well as foreign investors.
The diversity of investment instruments, such as stocks, mutual funds, real estate, and other investment options, is growing day by day, enabling individuals to diversify their investment portfolios. As India’s economy is expanding, the emerging market offers the potential for higher returns compared to the developed markets.
While investing in Indian markets, investors must learn about the principles and fundamentals of the investment options in India. Cultivating a disciplined approach with a deeper understanding of investment plans and making financial decisions aligned with financial goals will help with wealth accumulation.
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Things to be aware of while investing in India
NRIs investing in India must be careful, as there are certain factors to be aware of to make an efficient investment. The following are the factors you should be aware of while investing in India:
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Final verdict
Among these investment options in India for NRIs, selecting the ideal investment plan is necessary to generate passive income. Instead of diversifying randomly, it is crucial to identify your interests and gain detailed insight into the specific investment plan where your passion lies.
Every investment option mentioned above comes with varying degrees of risk and associated return. However, making informed decisions by learning the concepts and markets of the respective investment source is critical to generating a potential return. It is always better to diversify your portfolio in areas where you have expertise than to diversify randomly without any knowledge.
Find your ideal investment plan with the help of this guide and seek guidance from professionals to understand the regulatory framework and policies for NRIs to invest in India.
Disclaimer:
The information provided on this blog is for general informational and educational purposes only and is not intended as financial, investment, legal, or tax advice. While we strive to ensure accuracy, completeness, and timeliness, the financial world is dynamic, and content may become outdated or subject to change. Always conduct your own research or consult with a qualified financial advisor before making any investment or financial decisions. The authors and publishers of this blog are not liable for any losses or damages arising from the use or reliance on the information presented.
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ABOUT AUTHOR
Abdul Latheef K is a Researcher at Jawaharlal Nehru University, New Delhi. He is also an Author, Educator, and Expert in personal finance and Investment. His areas of interest comprise the Stock Market, foreign capital flows, and Open Economy Macroeconomics.
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