• If you stay abroad because you are employed there, you are a non-resident.

• If you stay abroad because you carry on a business or pursue a vocation there, you are a non-resident.
• If you are in a situation where your stay outside India is for an indefinite period, you are a non-resident.

If there is any ambiguity regarding the above criteria, for example, if you carry on business in India as well as abroad, you will probably be considered a resident of India if you stay in India for more than one hundred and eighty two days during the course of the preceding financial year

(This definition is for exchange control purposes only. For income tax there is a different definition based on period of stay).

Q2. How do I know if I am a Non Resident Indian (NRI)?

• If you are a non-resident and are an Indian citizen, you are a NRI.

• If you are a non-resident foreign citizen and if you are of Indian origin, you are a NRI.

Q3. How do I know if I am a person of Indian origin?

• If you are a foreign citizen and want to open bank accounts or invest in Indian shares and securities, you are considered to be of Indian origin if,

• You, at any time in your life held an Indian passport, or

• You or any one of your parents or any one of your grand parents was a citizen of India, or

• You are not of Indian origin but your spouse is an Indian citizen or is a person of Indian origin. (Your bank accounts and investments should be held jointly with your spouse).

Note: If you are a citizen of Pakistan or Bangladesh, you are not considered to be of Indian origin even if you meet the above criteria.

• If you want to acquire immovable property in India, you are considered to be of Indian origin if,

• You, at any time, held Indian passport, or

• You or either your father or grandfather was a citizen of India,

If you are a citizen of Pakistan, Bangladesh, Sri Lanka Nepal, Bhutan, Afghanistan, China or, Iran you are not considered to be of Indian origin even if you meet the above criteria.

Q4. If I am a NRI, what happens to my status when I come to India?
You become resident in India only when you come back to India for employment, to carry on business or pursue a vocation. You also become a resident if you return to India to stay for an indefinite period. If you continue to have a business or employment abroad, you will probably be considered a resident of India if you stay in India for more than one hundred and eighty two days during the course of a financial year

Q5. What if I come to India for a holiday?
You continue to be a NRI when you visit India for on holiday, leave etc.

Q6. What if I come to India on a business trip?
You continue to be a NRI when you visit India for short periods on business as long as you continue to be employed or have a business abroad.

Q7. If I am an NRI, what are the investment opportunities available to me in India?
There is a whole range of investment opportunities is open to you. Bank Deposits, Government Securities, Public Sector Bonds, Primary Share Issues (both public and private placement), Secondary Equity Markets, Convertible And Non- Convertible Debentures, Partnership And Proprietary Concerns, Start Ups, Mutual Funds, Company Deposits, Immovable Property Etc.

Q8. If I invest in India, can I take my money back?
If your investment is originally made on "repatriation basis", either under the general or specific permission of the Reserve Bank/Government of India, you can take back abroad the principal and the income. If your investment is on non- repatriation basis you can take back only the income.

Q9. Do I need permission to invest in India on repatriation basis?
The Reserve Bank of India and the Government have granted general permission for some kinds of investment. In other cases you need permission.

You do not need prior permission to invest in Bank Deposits. If you want to invest in new issues of shares or debentures, the issuing company will normally get the necessary approval. Mutual Funds will also get the clearance from the RBI for new issues.

Q10. What are the different kinds of Bank Accounts that I, as an NRI, can maintain in India?
If you are keen on repatriation of both principal and interest, you can open a Non Resident External (NRE) account or a Foreign Currency Non Resident (FCNR) account.

On non-repatriation basis you can maintain a Non Resident Ordinary (NRO) account, a Non Resident (Special) Rupee (NRSR) account or a Non Resident Non repatriable (NRNR) account.

Q11. What are Non-resident (External) (NRE) Accounts?
These are Indian Rupee accounts, which you can maintain as Saving Bank, Current or Term Deposits.

• You can hold the account jointly with another non- resident Indian.

• You can authorize a resident to operate the account for all local payments except gifts.

Q12. What are Non-resident (External) (NRE) Accounts?
The principal and interest can be taken back abroad. You don't have to pay income tax on the interest earned on these deposits. You need not pay wealth tax on the deposits.

Q13. Are there any restrictions on operations in NRE accounts?
Yes there are. For example, you cannot credit local funds to your NRE account. Some, not all, of the sources from which you can credit funds to your NRE Account are given below:

• Inward remittance from abroad

• Transfer from other repatriable accounts (NRE/ FCNR accounts)
• Proceeds of foreign currency traveler's cheques or currency notes during visits to India.
• Income from investments made on repatriable basis.
• Sale proceeds of investments made on repatriable basis.

Q14. Can I borrow against these accounts?
You can take a loan or overdraft in India against your NRE deposit for some approved purposes. You can also borrow overseas against these deposits. Your relatives and friends in India can get credit facilities in India against the security of your NRE fixed deposits subject to some conditions.

Q15. What is a FCNR account?
FCNR (Foreign Currency Non Resident) Account is similar to the NRE account. The difference is that unlike the former, which is maintained in Rupees, you can have a FCNR account in US Dollars, Pound Sterling, Euro, Deutsche Mark or Yen.

Q16. Are there any stipulations regarding the maturity of a FCNR account?
Unlike the NRE account, which can be a savings, current or term deposit, your FCNR deposits has to be a fixed deposit for one of these three maturities: (a) one year and above but less than 2 years, (b) two years and above but less than 3 years and (c) three years.

Q17. Between FCNR and NRE accounts, how do I decide where to place my money?
If the rupee depreciates the NRE holder loses while the FCNR holder is protected. If the Foreign currency depreciates the FCNR holder loses while the NRE holder is protected. The NRE account pays a higher rate of interest than the FCNR account.

Depending on your personal situation, investment objectives and appetite for risk you should be able to decide where to put your money. However, it may be a good idea to get professional advice.

Q18. Under the FEMA Regulations to whom is general permission available for purchase immovable property in India?
General Permission is available to purchase only a residential/commercial property in India to a person resident outside India who is a citizen of India (NRI) and who is a Person of Indian Origin (PIO).

Q19. Can a name of a foreign national of non-Indian origin be added as a second holder to a residential/commercial property purchased by NRI/PIO?
No.

Q20. Can a person resident outside India (i.e. a NRI or a PIO or a foreign national of non-Indian origin) acquire agricultural land/plantation property/farm house in India by way of purchase?
No. A person resident outside India cannot acquire by way of purchase agricultural land/plantation property/farm house in India.

Q21. Can NRI/PIO transfer by way of mortgage his residential/commercial property to an authorized dealer/housing finance institution in India?
Yes.

Q22. Can NRI/PIO transfer by way of mortgage his residential/commercial property in India to a party abroad?
No. He should seek prior approval of RBI.

Q23. Can a person resident outside India who has established a Liaison Office in India in accordance with FERA/FEMA regulations purchase immovable property?
No.

Q24. Can Foreign Embassies/Diplomats/Counsel General purchase/sell immovable property in India?
Yes. Under general permission available Foreign Embassies/Diplomats/Counsel General may acquire any immovable property other than agricultural land/plantation property/farm house in India. Such property may be purchased/sold provided prior clearance from the Government of India, Ministry of External Affairs has been obtained for such purchase/sale. The consideration for purchase of such property should be paid by way of inward remittance through normal banking channel.

Q25. Can NRI/PIO rent out the residential/commercial property purchased out of foreign exchange/rupee funds, if not required for immediate use?
Yes. Rent received, being current income may be credited to NRO/NRE account or remitted abroad.

Q26. Is a person resident in India governed by the provisions of Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2000?
A person resident in India who is a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan is governed by the provisions of Foreign Exchange Management (Acquisition and transfer of immovable property in India) Regulations, 2000.

Q27. Non-resident Indians are staying abroad can the property be purchased through the agent or through the Power of Attorney?
The non-resident Indians who are staying abroad may enter into an agreement through their relatives and/or by executing the Power of Attorney in their favour as it is not possible for them to be present for completing the formalities of purchase (negotiating with the builder or Developer, drafting and signing of agreements, taking possession, etc.) These formalities can be completed through some known person who can be given the Power of Attorney for this purpose. Power of Attorney should be executed on the stamp paper before the proper authorities in foreign countries. Power of Attorney cannot be drafted on the stamp paper bought in India.