Investment by an Indian Resident outside India
An Indian person can make an investment in outside India, either under the Automatic Route or the Approval Route.
What are the General Permissions available to persons (Individual) Resident in India for Purchase / Acquisition of Securities?
General permission has been granted to persons (individual) resident in India for purchase/acquisition of securities as under:
- a) Out of funds held in the RFC account;
- b) As bonus shares on existing holding of foreign currency shares;
- c) When not permanently resident in India, from the foreign currency resources outside India.
General permission is also available to sell the shares so purchased or acquired.
- LIMIT FOR INVESTMENT IN ABROAD?
A resident Indian can remit, up to the limit prescribed by the Reserve Bank from time to time, per financial year under the Liberalized Remittance Scheme (LRS), for permitted current and capital account transactions including purchase of securities and also setting up/acquisition of JV/WOS overseas with effect from August 5, 2013 (vide Notification No. 263).
- WHAT ARE THE PROHIBITED ACTIVITIES FOR OVERSEAS DIRECT INVESTMENT?
- *Real Estate Business, as per Notification No. FEMA 120/RB-2004 dated July 7, 2004.
- Banking Business;
*Real estate business means buying and selling of real estate or trading in Transferable Development Rights (TDRs) but does not include development of townships, construction of residential/commercial premises, roads or bridges.
- SOME OF THE OTHER ODI TRANSACTIONS THAT REQUIRE RBI APPROVAL?
- Overseas Investments in the energy and natural resources sector exceeding the prescribed limit of the net worth of the Indian companies as on the date of the last audited balance sheet;
- Overseas Investments by proprietorship concerns and unregistered partnership firms satisfying certain eligibility criteria;
- Investments by Registered Trusts / Societies (satisfying certain eligibility criteria) engaged in the manufacturing / educational / hospital sector in the same sector in a JV / WOS outside India;
Our Corporate Professional Team is ever willing to provide assistance on any issue concerning GST, Insolvency and Bankruptcy Law, Business Model Advisory in India and Abroad, Customs Law, Corporate & Commercial Advisory, IPRs. Secretarial Compliances, Agreement Drafting & Negotiations etc. you may write us on [email protected], [email protected]