Portfolio Investment Scheme (PIS) has been newly introduced by the Reserve Bank of India to make the route to foreign investment in India simpler and attractive. This scheme enables NRIs and OCBs to purchase and sell shares of Indian companies without getting involved into too much of complications and investment related technicalities.
All transactions will be recognized by stock exchanges and routed through your active NRI savings account.
How attractive is India to foreign investors?
India is one of the most appealing destinations of foreign investment. The country is projected to become the third largest economy in the world by 2025. Research and analysis rates India as the best investment destination, ahead of China. 65% of the Indians are in the working age group of 18 to 64 years, making the demography of India favorable for investment. The BSE Sensex in India has remained stable despite global turmoil. All these advantages invite foreign investors to India.
There are several conditions that should be fulfilled if you want to avail this scheme. You definitely cannot be an Indian resident and must have received permission from any AD Category- I bank (banks authorized by RBI to administer the PIS). Your salary details, age, employer and your designation in your company etc. are required to carry out portfolio investment in India.
You need to start with opening an account with any of RBI approved bank of AD Category- I who has a wide network and international presence. You may also open a Special Non-resident Rupee Account (SNRR) as your first step towards portfolio investment in India.
Documents required for portfolio investment in India are a PAN card, 3-4 passport sized photographs, photocopies of an Indian address proof such as Voter Id Card, Driving License etc, an Overseas address proof, a PIO card or OCB master card, a permanent foreign Id proof and VISA card.
Apart from these, you may also be asked to submit your salary and savings details, your assets and liabilities etc. depending upon the requirements of the bank you have chosen.
The annual maintenance fee to keep your Portfolio Investment Scheme (PIS) account active is around Rs. 1000 + service tax and you also need to pay an RBI approval fee of Rs.750 + service tax.
Thus Portfolio Investment Scheme is a lucrative offer and India’s rapid economic growth coupled with an increasing number of indigenous companies, assures you a high return on investment.