NRI Investing Guide 2026: How to Invest in India and Globally

NRE (Non-Resident External) accounts hold foreign-earned income in India. The principal and interest are fully repatriable (you can move the money back abroad freely). Interest on NRE accounts is tax-free in India — a significant advantage for high earners. NRO (Non-Resident Ordinary) accounts hold India-sourced income: rent, dividends, pension. Repatriation is limited to $1 million per year and interest is taxed at 30% (plus surcharge and cess) unless reduced by a tax treaty.

For most NRIs who want to invest in Indian stocks or mutual funds, NRE accounts are preferred: tax-free interest, full repatriation, and clean separation from India-earned income.

To invest in Indian stocks directly, NRIs must open a PIS (Portfolio Investment Scheme) account with a designated bank (ICICI, HDFC, Kotak, etc.) linked to an NRE or NRO account. The PIS account requires RBI approval (handled by the bank). You then link this PIS account to a demat account with a stockbroker (Zerodha, ICICI Direct, Kotak Securities).

NRIs can invest in Indian mutual funds directly using an NRE or NRO bank account. Most fund houses accept NRI applications online through their portals or via platforms like MFCentral. US and Canada-based NRIs face additional compliance issues: many Indian AMCs have stopped accepting investments from US/Canada-based NRIs due to FATCA/CRS compliance costs. Check with the specific fund house before applying.

NRIs are not subject to LRS for investments made from their foreign income in their country of residence — LRS only applies to Indian residents remitting from India. However, if you remit funds from an Indian NRO account abroad to invest, that does come under RBI's repatriation rules ($1M/year).