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Union Budget 2026-27 has introduced a wide range of reforms to make India a more accessible investment market for Non-Resident Indians (NRIs). The changes focus on easing equity investment rules, reducing tax friction on overseas spending, simplifying property transactions, and offering compliance relief for foreign assets.
One of the most significant reforms announced by Nirmala Sitharaman is the expansion of equity investment access for individuals living abroad.
The Budget proposes allowing persons resident outside India (PROI) to invest more freely under the Portfolio Investment Scheme (PIS).
The per-investor cap for individual PROIs has been raised from 5% to 10%, while the aggregate limit for all such investors has been expanded from 10% to 24%.
This move widens ownership headroom in listed companies and reduces dependence on institutional foreign flows.
Industry experts note that NRIs and PROIs tend to be long-term investors, which can improve market stability, liquidity, and price discovery over time.
The Budget also reinforces India’s ambition to position Gujarat International Finance Tec-City (GIFT City) as a global financial hub.
Regulatory clarity and improved product access at GIFT City are expected to make cross-border investments simpler for NRIs, offering globally competitive platforms with streamlined compliance.
Tax Collected at Source (TCS) on overseas tour packages has been reduced to a flat 2% from 5%, removing earlier tier-based thresholds.
Similarly remittances for education and medical treatment abroad under the Liberalised Remittance Scheme now attract 2% TCS instead of 5%, easing cash flow pressure for families supporting overseas expenses.
Tax deduction on property transactions will now be processed using the buyer’s PAN-based challan, eliminating the need for resident buyers to obtain a separate Tax Deduction and Collection Account Number.
This is expected to speed up transactions and reduce compliance hurdles.
A six-month, one-time Foreign Asset Disclosure Scheme has been introduced for individuals with undeclared overseas income or assets.
The scheme allows regularisation of assets up to Rs. 1 crore with tax and penalty payments. Higher-value assets can be disclosed with immunity from prosecution upon meeting prescribed conditions.
This provides a clean-slate opportunity, especially for young professionals and recently relocated NRIs.
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According to the Ministry of External Affairs, India has 35.4 million overseas Indians across the world, and it states a substantial pool of potential long-term capital.
By lowering regulatory friction and offering clearer investment pathways, Budget 2026 signals India’s intent to integrate its diaspora more deeply into domestic markets. It will also strengthen capital depth, currency stability, and long-term economic growth.
