Investments made by non-resident Indians (NRIs) on a non-repatriation basis will not be considered for the calculation of an indirect foreign investment.
The Department for Promotion of Internal Policy and Trade (DPIIT) under the Ministry of Commerce and Industry has reviewed the policy on downstream investments made by non-resident Indians (NRIs).
This means an addition to the Consolidated FDI Policy Circular 2020 effective from October 15, 2020, which is amended from time to time.
It has been clarified that investments made by NRIs on a non-repatriation basis under Schedule IV of the Foreign Exchange Management (Non-debt instruments) Rules 2019 are deemed to be domestic investments at par with investments by residents.
“Accordingly, an investment made by an Indian entity which is owned and controlled by NRIs on a non-repatriation basis shall not be considered for calculation of indirect foreign investment,” DPIIT said in a circular.