To begin
with, let’s list the people who can invest in India, aside from the obvious of resident
Indians. NRIs (Non-Resident Indians) and their spouses as well as PIOs (Persons
of Indian Origin) are allowed to possess both residential and commercial
property on Indian soil. OCBs (Overseas Corporate Bodies) and trusts which have
more than 50% NRI ownership/stake are also allowed to invest in Indian real
estate. At the same time, foreigners or foreign owned organizations have
certain processes and permissions to obtain from the Reserve Bank of India to
obtain property in the country. In their case, leasing is a better option.
It is
important to remember that while investing as an NRI or OCB, the property
should be rented out or occupied immediately! You cannot invest in real estate
and leave it empty. While you are allowed to invest in all types of residential
and commercial property from townships and industrial factories to apartment
complexes and showrooms, an NRI or OCB cannot invest or own agricultural land
in India.
However,
there are rules that the RBI imposes on income made from property owned by
NRIs. All income generated from rentals is to be deposited in an NRO (Ordinary
Non-Resident Rupees) account. At the same time, shares and debentures can be
returned after a time period of three years.
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