NRIs can invest in the Indian stock market based on repatriation and non-repatriation:
Repatriation vs Non-Repatriation
Repatriation:
- Definition: Repatriation allows NRIs to transfer money from their NRI bank account in India to their foreign bank account.
- Process: Funds are converted from Indian Rupees (INR) to the desired foreign currency.
- Account Type: The NRI bank account designed for repatriation is the Non-Resident External (NRE) account.
Non-Repatriation:
- Definition: Non-repatriation means that profits, dividends, or other income from investments made in India cannot be freely transferred to the investor's home country.
- Restrictions: There are limits and restrictions on repatriation of such funds.
- Account Type: The NRI bank account for investments on a non-repatriation basis is the Non-Resident Ordinary (NRO) account.
