For NRIs to Start Investing More in India, Policies Need to Be Flexible
May 17, 2017 Home Trading Steps
NRIs often find it difficult to invest in India due to non-flexibility of the policies regarding real estate. It is the time when government relaxed its policies to woo more NRIs into buying and investing in India. For now, NRIs can only invest in real estate. NAREDCO is trying to get NRIs be allowed to build commercial properties and large scale constructions. Relaxation of policies to the NRIS will not only help in reviving the slumped real estate market of the country but will also help in clearing out the high level of inventory.
According to the reports, Indian are the highest investors in non- GCC (Gulf Cooperation Council) in Dubai. In the realty estate market of US, Indians are the third largest investors after Canadians and Chinese. Other countries like UK, Singapore, Vietnam, and Australia have seen a high rise in the investments by Indians.
Restrictions for NRIs to invest in India
According to Section 6(5) of Foreign Exchange Management Act, 1999 (FEMA), any non-resident of India can hold, buy or sell any immovable property only if the property is acquired, held or owned by such person when he was resident of India or is inherited by a person who was the resident of India.
A person who is a non-resident of India is only permitted to repatriate the proceeds the sale of immovable property in India if the following conditions are satisfied:
1. The sale of the immovable property only if it was acquired when he was the resident of India or it is inherited from a resident in India.
2. Permission from the Reserve Bank of India has been acquired.
According to the regulations under FEMA, foreign nationals cannot hold a property in India until and unless the permission has been acquired by RBI, with some exceptions:
1. If the foreign national has inherited the property from a resident of India.
2. If the property has been leased but for not more than five years.
3. When a foreign national buys a property in India they have to satisfy the minimum requirement for the same like period of stay, a particular type of VISA.
Developers have realised the potential of NRI investment in Indian real estate and have started showing their projects in exhibitions outside India to bring more investors. Experts suggest that certain relaxation in the policies involving the NRIS and real estate will bring more investors. Allowing the land title agreement and the renewable ownership leases for the acquisition of immovable property must be allowed to the foreign nationals. Countries like UAE, Singapore have seen a huge surge in real estate market by foreign investors. Relaxing certain policies will help Indian real estate market bloom.
According to the reports, Indian are the highest investors in non- GCC (Gulf Cooperation Council) in Dubai. In the realty estate market of US, Indians are the third largest investors after Canadians and Chinese. Other countries like UK, Singapore, Vietnam, and Australia have seen a high rise in the investments by Indians.
Restrictions for NRIs to invest in India
According to Section 6(5) of Foreign Exchange Management Act, 1999 (FEMA), any non-resident of India can hold, buy or sell any immovable property only if the property is acquired, held or owned by such person when he was resident of India or is inherited by a person who was the resident of India.
A person who is a non-resident of India is only permitted to repatriate the proceeds the sale of immovable property in India if the following conditions are satisfied:
1. The sale of the immovable property only if it was acquired when he was the resident of India or it is inherited from a resident in India.
2. Permission from the Reserve Bank of India has been acquired.
According to the regulations under FEMA, foreign nationals cannot hold a property in India until and unless the permission has been acquired by RBI, with some exceptions:
1. If the foreign national has inherited the property from a resident of India.
2. If the property has been leased but for not more than five years.
3. When a foreign national buys a property in India they have to satisfy the minimum requirement for the same like period of stay, a particular type of VISA.
Developers have realised the potential of NRI investment in Indian real estate and have started showing their projects in exhibitions outside India to bring more investors. Experts suggest that certain relaxation in the policies involving the NRIS and real estate will bring more investors. Allowing the land title agreement and the renewable ownership leases for the acquisition of immovable property must be allowed to the foreign nationals. Countries like UAE, Singapore have seen a huge surge in real estate market by foreign investors. Relaxing certain policies will help Indian real estate market bloom.
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