Non Resident Indians (NRIs) planning to invest in shares have to open a Portfolio Investment Scheme or PIS, according to RBI guidelines or else they will not be able to buy and sell shares.
Whom to approach to open such an account?
You can approach the designated branches in India or abroad. Several Indian banks have their branches abroad to cater to the growing needs of NRIs. They normally help in opening three in one accounts for savings, trading and demat and also PIS.
For example, State Bank of India and banks like ICICI Bank have their branches abroad. If not, you can open the same in India or online as well. It's important to note that any purchase and sale has to be routed through such a PIS and it becomes easy for authorities to check the NRI holdings in a particular share.
It's important to note that NRIs can trade in the following:
2) Government dates securities
3) Domestic mutual fund units
Persons of Indian origin and OCIs can also invest in shares through the route.
An NRI can open a separate trading account for both NRI and NRE. Banks have to ensure that all the documents of the NRIs are in order before opening these accounts. Foreign address proof and also the passport copy along with the valid visa has to be served as proof.
In case domestic address is required then that address proof may have to be provided. Opening an account for PIS and related trading, demat account is slightly tedious in the case of NRIs. In case of Power of Attorney a little more documentation would have to be done.
But, once the process is completed you can buy and sell without hassles.