The Central Government has opened the individual portfolio investment route in listed Indian companies to all individuals resident outside India, not only NRIs and OCIs.
What has changed
- The FEMA (Non-Debt Instruments) Rules earlier allowed this route only for NRIs and OCIs.
- Now any individual resident outside India can make the specified investments in listed Indian companies.
- Rule 9 and Chapter V of the Rules have been amended, and the chapter now refers to an individual resident outside India, including NRIs and OCIs.
Tax angle
Capital gains and dividends earned by these investors are taxable in India subject to the applicable tax treaty. Investors will need a valid tax residency certificate and should consider treaty eligibility rules, including principal purpose tests, before claiming relief.
Our view
This is a meaningful widening of the investor base for listed companies. Foreign individuals investing for the first time should plan the account structure, KYC and tax documentation together.
Reference: Foreign Exchange Management (Non-Debt Instruments) (Third Amendment) Rules, 2026, notified on 12 June 2026.