The Indian government plans to tighten investment norms for non-resident Indians (NRI) in companies to ensure that they do not violate foreign direct investment (FDI) where such investment is banned such as with Indian real estate.

The Reserve Bank of India (RBI) has also mooted a proposal to withdraw the special status given to NRIs for investing in sectors such as aviation, housing and real estate.

NRIs, for example, are permitted to invest up to 100 per cent in air transport services as against only 49 per cent allowed to other foreign investors. Also, NRIs are exempt from the conditions imposed on minimum capitalisation norms in real estate as well as the minimum size of area to be developed for housing.

In the Indian real estate sector FDI policy has imposed certain key conditions like the minimum area to be developed should be 10 hectares in case of development of serviced housing plots, and built up area of 50,000 square metres in case of construction development projects. But these restrictions do not apply on NRIs.

Enter your email address:         Delivered by FeedBurner

Tags: Indian NRI companies, Indian Real Estate, Indian real estate companies, RBI

This entry was posted on Monday, April 19th, 2010 and is filed under Foreign Ownership in India. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.