How NRIs Can Invest in India: A Shariah-Compliant Guide

For the millions of Indians living abroad, maintaining a financial connection to India while building wealth in their country of residence requires careful planning. The regulatory framework — primarily FEMA (Foreign Exchange Management Act) — governs how NRIs can invest in Indian assets, and navigating it correctly is essential.

Understanding NRI Status

Your NRI status is determined by your physical presence in India during the financial year. If you spend fewer than 182 days in India in a financial year, you are generally classified as an NRI for tax and FEMA purposes. This classification affects which accounts you can hold, which investments are permitted, and how funds can be repatriated.

NRE vs NRO Accounts

**NRE (Non-Resident External) Account** - Holds foreign earnings converted to INR - Fully repatriable — funds can be moved abroad freely - Interest is tax-free in India (though may be taxable abroad) - Used for investments intended to be repatriated

**NRO (Non-Resident Ordinary) Account** - Holds income earned in India (rent, dividends, etc.) - Repatriation subject to limits and compliance - Subject to TDS in India

For Shariah-compliant investing, the interest on NRE accounts presents a complication. We advise clients on structuring their accounts to minimise interest accumulation while maintaining compliance.

Shariah-Compliant Investment Options for NRIs

NRIs have access to most Indian investment instruments through FEMA-compliant channels:

• **Equity and Mutual Funds**: Direct equity investment and Halal mutual funds via NRE/NRO accounts are fully permitted
• **Digital Gold**: Accessible and fully Halal
• **Shariah-Screened Equities**: Via our partnership with Islamicly and Shariah Cap
• **Global Markets**: Through our partnerships with Fine Axis Singapore and Samco US Equities

Repatriation Planning

Moving funds from India to your country of residence requires: - Compliance with RBI repatriation limits - Form 15CA/CB submission (for repatriations above certain thresholds) - Appropriate tax documentation

We work with our partners to ensure your repatriation plans are structured correctly and compliantly.

Our NRI Advisory Service

Sapient's NRI & Global Wealth Advisory service provides end-to-end guidance for cross-border investors — from account structure to investment selection, tax efficiency, and repatriation planning. All within a Shariah-compliant framework.

Contact us to discuss your specific situation.