Things NRIs Must Keep in Mind While Investing in India

India is considered as the fastest economic development nation in the world. This assures the promising market whereby most of the investors tend to make an investment in India. India offers high-interest rates compared to other nations in the world. This makes a majority of the NRI’s to make an Investment in India. NRI can choose investment plans like fixed deposit, mutual fund, real estate investment, treasury bills and company deposit. Nonresident Indian can make their investment in equity market but they understand the risks and returns that can be expected in such investment. Equity is also considered as the long-term investment goal and there is also no limitation for the amount to be invested in the equity market. NRI can also make their Investment in Mutual Fund which is also considered as the safe method of investment compared to the equity. The mutual fund requires the individual to possess less expertise about the market trend and risks. They do not require any specific approval for investment. When the NRI is a resident of USA or Canada then specific investment house rules should be checked prior to investment such that the cash is not locked within an investment scheme.

It is known that people residing in the other nation are not allowed to avail the home loan whereby NRI may plan to purchase a property and lend them for rent or lease the property. Individuals can create an NRE account the funds deposited in foreign currency gets converted into Indian rupees to the current conversion rate. The cash deposited in Indian bank can also be transferred to any country. When the individual pretends to make an investment with the short term gain then he/she should make a payment of 15% tax to the government whereas if the Investment is long-term then the tax on such gains is free from payment. Equity funds declare dividends to the clients they also levy tax-free to the NRI investor. Debt-oriented mutual funds also offer dividends of tax-free to the NRI. Suppose the NRI makes an investment with the foreign companies then these dividends are taxable to the NRI. So a proper research about the investment and the risks associated with each type of cash deposit along with their increased returns should be analyzed before making an investment. Hence Investment in India makes the NRI earn a handsome amount undoubtedly.

Mr. Jude D - Managing Director of Right Horizons Financial Services Pvt Ltd in India.