Non-Resident Indians (NRIs) investments in India on a non-repatriation basis will no longer be considered for the calculation of an indirect foreign investment.
Under India’s Ministry of Commerce and Industry, The Department for Promotion of Internal Policy and Trade (DPIIT), has reviewed the policy on downstream investments made by NRI’s.
This is an addition to the Consolidated FDI Policy Circular 2020 which is effective from October 15, 2020 and it gets amended from time to time.
Now it has been explained that investments made by Non-Resident Indians on a non-repatriation basis under Schedule IV of the Foreign Exchange Management (Non-debt instruments) Rule 2019 are deemed to be domestic investments at par with investments by residents Indians.
As per the DPIIT circular: “Accordingly, an investment made by an Indian entity which is owned and controlled by NRIs on a non-repatriation basis shall not be considered for calculation of indirect foreign investment,”.
