Investment by NRI in partnership firm in India

By | August 14, 2015

Investment by NRI in partnership in India

Question : Whether the NRI Can invest in partnership or proprietorship firm  in India ? are there any restrictions ?

Investment by NRI/PIO in partnership/proprietary concern

NRI/PIO resident outside India can invest by way of capital of a partnership firm or a proprietary concern on non-repatriation basis, provided that the firm/concern is not engaged in agricultural/plantation or real estate business in land and immovable property with a view to earning profit or income therefrom, or print media – Para 3.2.2 of Consolidated FDI Policy Circular No. 1 of 2014 dated 17-4-2014 issued by DIPP of MC&I.

Amount invested is not eligible for repatriation [para 1 part II of RBI Master Circular No. 15/2014-15 dated 1-7-2014 on ‘Foreign Investment in India’ [earlier RBI Master Circular No. 15/2013-14 dated 1-7-2013].

NRI/PIO can invest in firm/proprietary concern on repatriation basis only with permission of RBI. The firm/concern cannot engage in agricultural/plantation or real estate business in land and immovable property with a view to earning profit or income therefrom, or print media. [paras 1 and 4 of Part II of RBI Master Circular No. 15/2014-15 dated 1-7-2014 on ‘Foreign Investment in India’ [earlier RBI Master Circular No. 15/2013-14 dated 1-7-2013] – Para 3.2.2(ii) of Consolidated FDI Policy Circular No. 1 of 2014 dated 17-4-2014 issued by DIPP of MC&I.

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