1. INVESTMENT WITH 100 REPATRIATION BENEFITS(100% SCHEME)
- HIGH PRIORITY INDUSTRIES
NRIs/PIOs/OCBs are permitted to invest upto 100% equity in new industries/expansion/diversification of existing industries listed as High Priority Industries.
TRADING COMPANIES
100% investment with repatriation benefits is also allowed in Trading companies primarily engaged in export activities and registered as Export/Tradings/Star Trading/Super Star
Trading Houses with the Directorate General of Foreign Trade. No prior permission from the Government of India/Reserve Bank of India is required for receiving inward remittances
and issue of shares to NRIs/PIOs/OCBs. The Indian Company is however, required to file form ISD(R) along with relevant documents with the concerned Regional Office of the Reserve
Bank of India within 30 days of issue of shares.
In the case of specified consumer goods industries, dividend balancing out of export earnings over a period of 7 years
from commencement of commercial production has to be met.
INVESTMENT IN 100% EXPORT ORIENTED UNITS (EOUs), UNITS IN FREE TRADE ZONE/EXPORT PROCESSING ZONES, SOFTWARE TECHNOLOGY PARKS (STPs), ELECTRONIC HARDWARE TECHNOLOGY PARKS (EHTPs)
Upto 100% equity on repatriation basis is permitted by NRIs/PIOs/OCBs.
Application for permission has to be made to the Development Commissioner of the Free Trade Zone/Export Processing Zone /Chief Executive of the STP/Designated officer of the EHTP.
INVESTMENT IN HOUSING AND REAL ESTATE DEVELOPMENT
NRIs/PIOs/OCBs can invest upto 100% in new issues of equity share of Indian companies engaged in :
- Development of serviced plots and built up residential premises.
- Real Estate covering construction of residential and commercial premises including business centres and offices
- Development of townships.
- City and Region level urban infrastructure facilities including roads and bridges
- Manufacturing of building materials
- Financing of Housing Development.
Repatriation of original investment is permitted after a lock in period of 3 years.
In the case of OCBs, repatriation of net profits (upto 16%) arising from the sale of such investments will be permitted after a lock in period of 3 years.
There is no "lock-in-period" for repatriation of dividend/interest on shares/convertible debentures by OCBs.
Application for investment has to be made in form ISD(R) to the Central Office of RBI.
DOMESTIC AIR TRANSPORT SERVICES
Upto 100% equity participation is permitted. Repatriation of investment and remittance of dividends will be permitted after a lock in period of 5 years and out of accumulated Net-Foreign Exchange Earnings.
Approval has to be obtained from the Foreign Investment Promotion Board (FIPB).
INVESTMENT IN SICK INDUSTRIAL UNITS
NRIs/PIOs/OCBs are permitted to make bulk investment on private placement basis, upto 100 equity capital of any sick company either by way of purchase of equity shares from the existing shares holders or in the form of subscription
to new equity shares of the sick company.
There is no 'lock-in-period' for such investments.
The Indian company has to apply for permission to the Central office of the Reserve Bank of India in form RSU.
2. INVESTMENT UPTO 40% EQUITY ON REPATRIATION BASIS (40% SCHEME)
NRIs/PIOs/OCBs are permitted to subscribe to new issues of equity shares/convertible debentures of new or existing
companies (both private and public limited) for setting up new industrial/manufacturing projects or expansion/diversification of such projects, as well as hospitals/diagnostic centres,
hotels(3/4/5 star), shipping, development of computer software and oil exploration services.
No prior permission is required for receiving inward
remittances and issue of shares to NRIs/PIOs/OCBs. The Indian company is required to file form ISD with relevant documents with the concerned Regional office of the Reserve
Bank of India within 30 days of issue of shares.
BANKING SERVICES
NRIs can invest upto 40% of the paid up capital in Private Banks. (inclusive of 20% allowed to other foreign investors)
3. INVESTMENT UPTO 24% EQUITY ON REPATRIATION BASIS (24% SCHEME)
NRIs/PIOs/OCBs are permitted to subscribe to new issues of equity shares/convertible debentures of new or existing companies (private and public limited) in the fields of finance, hire
purchase, leasing, trading or other services (except agriculture/plantation activities), and establishment of schools/colleges in India upto 24%.
No prior permission is required for receiving inward remittance and issue of share to NRIs/PIOs/OCBs. The Indian company is required to file form ISD(R) with relevant documents with the concerned Regional Office of the Reserve Bank of India
within 30 days of issue of shares.
In the case of items reserved for small scale sector, investment by NRIs/PIOs/OCBs upto 24% is allowed. Application for permission has to be made in form FC/IL(SIA)to the Secretariat for Industrial Assistance.
4. OTHER INVESTMENTS WITH REPATRIATION BENEFITS
- INVESTMENT IN DOMESTIC MUTUAL FUNDS
NRIs/PIOs/OCBs can invest in domestic, private or public sector Mutual Funds on repatriation basis.
The concerned Mutual Fund is required to obtain permission from the Reserve Bank of India by applying in Form ISD(R).
INVESTMENT IN BONDS ISSUED BY PUBLIC SECTOR UNDERTAKINGS
NRIs/PIOs/OCBs are permitted to invest in Bonds issued by Public Sector Undertakings. The concerned Public Sector undertaking should obtain necessary permission from the
Government of India for raising funds through such Bonds. They are also required to obtain permission from the Central office of Reserve Bank of India by applying in form ISD(R).
GENERAL PERMISSION TO NRIs/PIOs/OCBs TO PURCHASE SHARES OF PUBLIC SECTOR ENTERPRISES
Shares disinvested by Government in such public sector enterprises can be purchased subject to ceiling applicable for portfolio investment.
Application has to be made by NRIs/PIOs/OCBs to the designated branch of State Bank of India.
DEPOSITS WITH COMPANIES
NRIs/PIOs (not OCBs) will be permitted to place funds in Fixed Deposit with Public limited companies including Government companies with limited liabilities (with full repatriation benefits).
Application for permission has to be made by the Indian company through its bank to the Regional Office of the Reserve Bank of India. The approval will also include authorisation for remittance of interest and maturity
proceeds to the depositor's NRE/FCNR accounts.
INVESTMENT IN SECURITIES/SHARES
NRIs/PIOs are permitted to invest their funds in Government securities (except bearer securities like Indira Vikas Patra/Kisan Vikas Patra) or units of the Unit Trust of
India and National Savings Certificates through authorised dealers. Units can also be purchased directly from the Unit Trust of India and freely transferred and sold.
If these are purchased out of funds remitted from abroad or from NRE /FCNR accounts, sale/maturity proceeds can be repatriated.
5. INVESTMENTS UPTO 100% EQUITY WITHOUT REPATRIATION BENEFITS
Proprietory/Partnership concerns - NRIs/PIOs can invest by way of capital contribution to any proprietory or partnership concern engaged in industrial/trading/commercial activity(except
agricultural/plantation activities or real estate business) upto 100%. The principal amount is non-repatriable.
(This facility is not available to OCBs).
The Indian company is required to file a declaration with Reserve Bank of India within 90 days in form DIN.
NEW ISSUES OF SHARES/DEBENTURES OF INDIANS COMPANIES
NRIs/PIOs/OCBs are permitted to subscribe to shares/convertible debentures of Indian companies on non-repatriation basis.
The Indian companies can issue shares or convertible debentures of new/right issues to NRIs/PIOs on non-repatriation basis
provided the company is not engaged in agricultural/plantation or real estate business. The payment towards these shares
shall be received by inward remittances or from NRE/FCNR/NRO accounts.
The Indian company should file a declaration in form DIN within 90 days from the date of receipt of investment with the concerned Regional office of the Reserve Bank of India.
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