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March 2025

Non-Repatriable Investment by NRIs and OCIs under FEMA: An Analysis – Part – 1

By Bhaumik Goda | Saumya Sheth | Devang Vadhiya, Chartered Accountants
Reading Time 25 mins

This is the 11th Article in the ongoing NRI series dealing with “Non-repatriable Investment by NRIs and OCIs under FEMA — An Analysis.”

Summary

“What cannot be done directly, cannot be done indirectly - Or can it be?"

FEMA’s golden rule has always been that what you cannot do directly, you cannot do indirectly—but then comes Schedule IV, sneaking in like that one friend who always finds a way out. It’s the ultimate legislative exception, allowing NRIs and OCIs to invest in India as if they never left, minus the luxury of an easy exit. Curious? Dive into the fascinating world of non-repatriable investments — you won’t be disappointed (unless, of course, you were hoping to take the money back out quickly!)

INTRODUCTION AND REGULATORY FRAMEWORK

Non-resident investors — including Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs), and even foreign entities — can invest in India under the Foreign Exchange Management Act, 1999 (FEMA). FEMA provides a broad statutory framework, which is supplemented by detailed rules and regulations issued by the government and the Reserve Bank of India (RBI). In particular, the Fo

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