What are the regulations regarding Portfolio Investments by Non-Resident Indians (NRIs) / Persons of India Origin (PIOs) ?
Ans. NRIs / PIOs can purchase / sell shares / convertible debentures of Indian companies on Stock Exchanges under the Portfolio Investment Scheme. For this purpose, the NRI / PIO has to apply to a designated branch of a Bank which deals in Portfolio Investment. All the sale / purchase transaction must be routed through the designated branch. An NRI or a PIO can purchase shares up to 5% of the paid up capital of an Indian company. All NRIs / PIOs (also the OCBs who had purchased shares under the earlier scheme) taken together cannot purchase more than 10% of the paid up value of the company. (This limit can be increased by the Indian company to 24% by passing a General Body resolution). Investment can be made both on repatriation basis or non-repatriation basis. For making investment on repatriation basis, it will be necessary to make payments by way of inward remittance or by debit to the NRE / FCNR account of the NRI / PIO. Investment on non-repatriation basis can also be made from th
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