Yes! An NRI (Non-Resident Indian) can purchase or acquire immovable properties in India subject to certain terms and conditions. This is governed by Foreign Exchange Management Act (FEMA) and is administered by Reserve Bank of India (RBI). RBI issues regulation from time to time elucidating the law and giving general permission to NRIs for purchase of certain immovable properties in India.
An NRI can acquire by way of purchase any immovable property (other than agricultural land/plantation property/farm house) in India. Foreign nationals of non-Indian origin resident outside India are not permitted to acquire any immovable property in India unless such property is acquired by way of inheritance from a person who was a resident of India.
Find below how an NRI and an Overseas Citizen of India (OCI) can acquire immovable property in India:
| Particulars | NRI/OCI |
| Purchase (other than agricultural land/ farmhouse/plantation etc.) from | Resident/NRI/OCI |
| Acquire as gift (other than agricultural land/farmhouse/plantation etc.) from | Resident/NRI/OCI who is a relative |
| Acquire (any IP) as inheritance from | a. Any person who has acquired it under laws in force; b. Resident |
| Sell (other than agricultural land/farmhouse/plantation etc.) to | Resident/NRI/OCI |
| Sell (agricultural land) to | Resident |
| Gift (other than agricultural land) to | Resident/NRI/OCI |
| Gift (agricultural land) to | Resident |
| Gift residential/commercial property to | Resident/NRI/OCI |
Mode of Payment for Purchase of the Immovable Property:
Payment for immovable property must be received in India through banking channels and is subject to payment of all taxes and other duties/levies in India. The payment can also be made out of funds held in NRE/FCNR(B)/NRO accounts of the NRIs/OCIs. Payments should not be made through travellers’ cheques and foreign currency notes.
Foreign Embassy/Diplomat/Consulate General can purchase/sell immovable property (other than agricultural land/plantation property/farm house) in India provided:
- Clearance from the Government of India, Ministry of External Affairs is obtained for such purchase/sale, and
- The consideration for the acquisition of immovable property in India is paid out of funds remitted from abroad through banking channels.
Can Foreign Nationals Acquire Property in India?
- Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan, Macau, Hong Kong or Democratic People’s Republic of Korea (DPRK), irrespective of their residential status, cannot, without prior permission of the RBI, acquire or transfer immovable property in India, other than on lease, not exceeding five years. This prohibition shall not be applicable to an OCI.
- Foreign nationals of non-Indian origin residing in India (except 11 countries listed at (a) above) can acquire immovable property in India.
- Foreign nationals of non-Indian origin residing outside India can acquire/transfer immovable property in India, on lease not exceeding five years and can acquire immovable property in India by way of inheritance from a resident.
Note that all other acquisitions/transfers by foreign nationals will require the prior permission of RBI
Citizen of Pakistan, Bangladesh or Afghanistan belonging to minority community (Hindu, Christian, Sikh, Parsi, Buddhist, Jain) in that country and residing in India who has been granted a long-term visa by the Central government can purchase only one residential immovable property in India as dwelling unit for self-occupation and only one immovable property for carrying out self-employment. However, such acquisition is subject to the conditions as specified under Rule 28 of Foreign Exchange Management (Non-Debt Instrument) Rules, 2019.
A person resident outside India, not being a Non-Resident Indian or an Overseas Citizen of India, who is a spouse of a Non-Resident Indian or an Overseas Citizen of India may acquire one immovable property (other than agricultural land/farm house/plantation property), jointly with his/her NRI/OCI spouse subject to the conditions laid down in regulation 6 of FEMA 21(R).
Repatriation of the Sale Proceeds of Immovable Property in India by Non-Resident:
(a) A person who has acquired the property U/s 6(5) of FEMA or his successor cannot repatriate the sale proceeds of such property without RBI approval.
(b) Repatriation up to USD 1 million per financial year is allowed, along with other assets under (Foreign Exchange Management (Remittance of Assets) Regulations, 2016) for NRIs/PIOs and a foreign citizen (except Nepal/Bhutan/PIO) who has (i) inherited from a person referred to in section 6(5) of FEMA, or (ii) retired from employment in India or (iii) is a non-resident widow/widower and has inherited assets from her/his deceased spouse who was an Indian national resident in India.
(c) NRIs/PIOs can remit the sale proceeds of immovable property (other than agricultural land/farm house/plantation property) in India subject to the following conditions:
- The immovable property was acquired in accordance with the provisions of the foreign exchange law in force at the time of acquisition or the provisions of Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations 2018;
- The amount for acquisition of the property was paid in foreign exchange received through banking channels or out of the funds held in foreign currency non-resident account or out of the funds held in non-resident external account;
- In the case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties.
India recently has experienced a tremendous rise in the development of luxurious apartments, making it an ideal time for NRIs to invest in real estate. With unimpeachable style and amenities to match international standards, one can experience and own some of the most beautiful homes in the country.
