We have devoted this section to NRIs, to answer the various questions that come in their minds regarding the investing opportunities in India, and the regulations regarding the same.
A foreign national, who was eligible to become a citizen of India on 26.01.1950 or was a citizen of India on or at any time after 26.01.1950 or belonged to a territory that became part of India after 15.08.1947 and his/her children and grand children, is eligible for registration as an Overseas Citizen of India (OCI). Minor children of such person are also eligible for OCI. However, if the applicant had ever been a citizen of Pakistan or Bangladesh he/she will not be eligible for OCI.
Notification No. 5/2000-RB (dealing with various kinds of Bank Accounts) defines the term Non Resident Indian (NRI) to mean a person resident outside India who is either a citizen of India or is a person of Indian origin.
Under the FEMA, a person resident in India means a person residing in India for more than 182 days during the course of the preceding financial year and who has come to or stays in India either for taking up employment, carrying on business or vocation in India or for any other purpose, that would indicate his intention to stay in India for an uncertain period. In other words, to be treated as .a person resident in India. under FEMA a person has not only to satisfy the condition of the period of stay (being more than 182 days during the course of the preceding financial year) but has to comply with the condition of purpose/ intention of stay.
An Indian Citizen who stays abroad for employment/carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. (Persons posted in U.N. Organisations and Officials deputed abroad by Central/State Governments and Public Sector undertakings on temporary assignments are also treated as non-residents). Non -Resident foreign citizens of Indian Origin are treated on par with non-resident Indian Citizens (NRIs) for the purpose of certain facilities.
The following are the main three categories of NRIs:-
Indian citizens who stay abroad for employment or for carrying on a business or Vocation or any other purpose in circumstances indicating an indefinite period of stay abroad.
Indian citizens working abroad on assignment with foreign government agencies like United Nations Organisation (UNO), including its affiliates, International Monetary Fund (IMF), World Bank etc.
Officials of Central and State Government and Public Sector undertaking deputed abroad on temporary assignments or posted to their offices, including Indian diplomat missions, abroad.
Types of NRI bank accounts
Non-resident accounts are based on
Repatriation : These are two types, namely Oridnary accounts without any repatriation facility and external accounts with full repatriation facility.
The currency of account : Non-residents can maintain their accounts either in Indian rupees or specified foreign currency mostly US& Pound Sterling, Deutsche marks or Japanese yen.
Non-Repatriable Accounts
Non-resident Ordinary Rupee Account-NRO A/C -Savings, Current and Time Deposits
Non-resident Non-Repatriable Term Deposits -NRNR Accounts.
Non-residents (Special) Rupee -NRSR Account : The scheme has been effective from 15th April, 1999.
Repatriable Accounts
Foreign Currency Non-resident Bank Deposits -FCNR-B Accounts.
Two earlier schemes namely Foreign currency Non resident Accounts (FCNR) and Foreign currency (Ordinary Non repatriable) (FCONR) deposit scheme were discontinued in 1994.
Acceptance of deposits under the FCNR scheme has been discontinued w.e.f. 15th August 1994. Deposits already accepted are however, allowed to continue till their maturity and thereafter no renewals would be permitted. Acceptance of deposit under the FCONR scheme has been discontinued with effect from 20th August 1994 and the existing deposits will not be renewed on maturity.