Non Resident Indians (NRIs) and Persons of Indian Origin (PIOs) can invest directly in the Indian markets.
NRIs and PIOs can open a demat account with any depository participant (DP). The NRI or PIO needs to mention the type and the sub-type (repatriable or nonrepatriable) in the account opening form collected from the DP. No permission is required from the Reserve Bank of India (RBI) to open a demat account. However, credits and debits from the demat account may require general or specific permissions as the case may be, from designated banks. Further, no special permission is required by a NRI for dematerialiation or rematerialisation of securities.
From the comments and emails I have received, a lot of NRIs seem to believe they can only invest in mutual funds or through Portfolio Management Services. I was also under the same impression. Now that the air is clear, I hope more NRIs and PIOs will come forward and invest directly; after all, investing in India is vogue and direct investment is perhaps better than investing through a fund, if you know what you are doing.
Tell me if you have problems going down this route – I hope that there is at least one brokerage that will let NRIs trade through an online account, let’s see which ones create issues.
