Property Laws for Overseas Indians & NRIs
Barring agricultural and plantation property, NRIs and PIOs are allowed to invest in property in India, and enjoy the same platform as resident Indians with respect to loans and insurance. They also enjoy parity with resident Indians on the quantum of investment in real estate, which is unlimited for all.
NRIs can purchase property from their remittances from abroad, and enjoy full repatriation benefits for up to two residential properties.
As per FEMA laws, PIOs are required to inform the RBI of their purchase of property in Form IPI 7 within 90 days of the transaction along with a bank certificate declaring the consideration made for the purchase.
The table below explains the policies and restrictions on NRIs and PIOs defined by the Foreign Exchange Management Act, 2000 on the acquisition and sale of property.
| NRI | PIO | Resident | |
|---|---|---|---|
| Purchase Property From | Yes | Yes | Yes |
| Sell Property To | Yes | Yes | Yes |
| Receive Gift From | Yes | Yes | Yes |
| Give Gift To | Yes | Yes | Yes |
| Agricultural Property | |||
| Purchase Property From | NO | NO | NO |
| Sell Property To | NO | NO | NO |
| Receive Gift From | NO | NO | NO |
| Give Gift To | NO | NO | NO |
| NRI | PIO | Resident | |
|---|---|---|---|
| Purchase Property From | Yes | Yes | Yes |
| Sell Property To | NO | NO | Yes |
| Receive Gift From | Yes | Yes | Yes |
| Give Gift To | Yes | Yes | Yes |
| Agricultural Property | |||
| Purchase Property From | NO | NO | NO |
| Sell Property To | NO | NO | Yes |
| Receive Gift From | NO | ||
| Give Gift To | NO | NO | Yes |
NRI Facts
There are many things NRI's should be aware of in India of how locals view them. The internet is crawling with stories of how NRI's have been treated by their very own immediate bloodline family members over assets of value including, kidnapping, torture and even murder although these are very isolated incidents.
There is a generally held view due to no fault of the locals, about NRI's when they visit India. NRI's give the impression they are well off than the locals and spend money like water and live up the life. Without a thought, they criticise the locals on their living habits, hygiene & lack of knowledge and then expect to be treated like VIP's.
India is a necessary visit to sort out their affairs and locals gear up to this opportunity to make something for themselves.
Everyone is in on it except NRI's. The locals don’t talk about it in front of their NRI relatives because they are either taking advantage themselves or understand why others close to them are.
You are out of the loop. When life changing sums are involved, the temptation of a big cut is often too much to resist. Your property often means more to your local relative than to you.
How sure can you be that your nice, helpful and friendly relatives have your best interests at heart? Arm yourself with knowledge.
Patience is a virtue something NRI's bang their heads into a brick wall when it comes to understanding Indian timing. Literally 1 min is not 60 seconds more likely 1/2 hour. Indians use a different timescale to most of us. This is a simple guide.