FAQ

Who is a non-resident Indian (NRI)?

As defined by the Foreign Exchange Management Act of 1999 (FEMA) an NRI is a person residing outside india who stays outside India for the purpose of employment or carrying on business or vocation outside India or any other circumstances, which indicate his intention to stay outside India for an uncertain period. As per regulation of FEMA an NRI is a non-Indian resident whose is either a citizen of India or a person of Indian Origin. Students studying abroad also can be treated as NRIs under FEMA and are accordingly eligible for foreign investment and NRE/FCNR account.

Ravi Puravankara was President of International Housing Federation (FIABCI), Paris, which has representatives from 62 countries. He received the 'Lifetime Achievement' award the Realty Plus Excellence Awards-2012.

Who is a person of Indian Origin (PIO)?

According the the Foreign Exchange Management Act of 1999 (FEMA) a PIO is a person who is either a citizen of any country other than Pakistan and Bangladesh who has:

  • held an Indian Passport at any time or
  • himself or either his parents or any of his grandparents were citizens of India or
  • is a souse of an Indian citizen or
  • is a spouse of a person who held an Indian Passport at any time or
  • is a spouse of a person who either was a citizen of India or his parents or grandparents were a citizen of India

Who is a PIO as defined for Immovable Property in India?

The definition of a PIO when it comes to acquisition and transfer of immovable property in India is a person of Indian origin other than a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan. For this purpose a PIOs father or grandfather’s birthplace of Indian citizenship at any time is to be considered unlike other definitions that refer to parents or grandparents.

Can an NRI/foreign national acquire immovable residential property in India?

Acquisition by purchase:
Yes, under general permission granted by the RBI an NRI/PIO can purchase a residential property in India

Acquisition by gift:
Yes, under general permission granted by the RBI an NRI/PIO can acquire a residential property by way of gift from a person in India or an NRI or a PIO.

Acquisition by inheritance:
Yes, an NRI/PIO/foreign national of Indian origin can acquire residential property by way of inheritance from a person who is a resident of India as per the Provisions of Section 6(5) of the Foreign Exchange Management Act, 1999. An NRI/PIO/ foreign national of Indian origin can also acquire residential property by way of inheritance from

Do NRIs/foreign citizens of India need to submit any documents with RBI when purchasing immovable residential property in India?

An NRI/PIO who has bought an immovable residential property under general permission is not required to file any documents with the Reserve Bank of India

Can a NRI transfer his residential property by way of sale?

Yes. Under general permission an NRI can sell his or her residential property in India to an Indian resident/NRI/PIO

Can a PIO transfer his residential property by way of sale?

Yes. Under general permission an NRI can sell his or her residential property in India to an Indian resident only.

Can a NRI/PIO transfer his residential property by way of gift?

Yes. An NRI/PIO can transfer their residential property in India by way of a gift to an Indian resident/NRI/PIO

What mode of payment can an NRI/PIO make to purchase a residential property in India?

Under the general permission, an NRI/PIO may purchase a residential property in India by funds remitted to India through normal banking channel or funds held in his NRE/FCNR (B)NRO account. No consideration shall be paid outside India.

Can NRIs obtain loans for acquisition of a house/flat for residential purpose from authorized dealers/financial institutions providing housing finance?

Reserve Bank has granted general permission to certain financial institutions providing housing finance e.g. HDFC, LIC Housing Finance Ltd., etc., and authorized dealers to grant housing loans to non-resident Indian nationals for acquisition of a house/flat for self-occupation subject to certain conditions. The purpose of the loan, margin money and the quantum of loan will be at par with those applicable to housing loans to residents. Repayment of loan should be made within a period not exceeding 15 years out of inward remittances or out of funds held in the investors' NRE/FCNR/NRO accounts.

What are the formalities required to be completed by foreign citizens of Indian origin for purchasing residential immovable property in India under the general permission?

They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration along with a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.

Can a NRI give their residential property on rent if not required for immediate use?

Yes. Reserve Bank has granted general permission for letting out any immovable property in India. The rental income or proceeds of any investment of such income are eligible for repatriation.