The Reserve Bank of India (RBI) has moved ahead with a key proposal announced in the Union Budget 2026, making it easier for Indians living abroad and other overseas individuals to invest in Indian companies.
On Friday, RBI Governor Sanjay Malhotra confirmed that the central bank will raise investment limits for Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) in listed Indian companies. “The limits for investment by NRIs and OCIs in equity instruments traded on the stock market without SEBI registration are being increased. Further, the same facility is being extended to all individual Persons Resident Outside India (PROIs) at par with NRIs and OCIs,” RBI said in a statement.
The move is aimed at improving ease of investment and attracting more overseas capital into Indian equities.
Union Budget 2026: What is changing?
Under the current rules, an individual NRI or OCI can invest up to 5% of the paid-up equity capital of a listed Indian company through the Portfolio Investment Scheme (PIS). Collectively, all NRIs and OCIs together can hold up to 10% of a company’s paid-up equity capital.
The RBI has now increased those limits.
The individual investment cap will be doubled from 5% to 10%, while the combined limit for all such investors in a company will rise from 10% to 24%.
The same facility will now be available to all individual Persons Resident Outside India, bringing them on par with NRIs and OCIs for investments in listed Indian equities.
While the RBI has officially announced the change, the policy itself was first unveiled by Finance Minister Nirmala Sitharaman during the Union Budget presentation on February 1, 2026.
The central bank’s role is to put the proposal into operation and lay down the regulatory framework needed for implementation. The RBI is expected to issue detailed guidelines separately, clarifying how the revised limits will be applied and monitored.
| Category | Previous Rules | New Rules |
|---|---|---|
| Individual NRI/OCI Investment Limit | An NRI or OCI could hold up to 5% of the paid-up equity capital of a listed Indian company under FEMA | The limit has been doubled to 10%. An individual NRI or OCI can now hold up to 10% of the paid-up equity capital of a listed company without requiring special approvals. |
| Aggregate NRI/OCI Investment Cap | The combined holding of all NRIs and OCIs in a listed company was capped at 10%. This could be increased to 24% only if the company passed a special resolution. | The aggregate limit is now 24% by default, matching the level that earlier required shareholder approval. |
Another major change is that individual Persons Resident Outside India will now be allowed to invest in listed Indian companies through the RBI’s Portfolio Investment Scheme, bringing them on par with NRIs and OCIs. This will allow eligible overseas individuals to buy shares on Indian stock exchanges directly.
The move comes at a time when overseas Indians are sending record amounts of money back home. According to RBI data, remittances reached a record $135.46 billion in FY25. By expanding investment limits, the RBI is seeking to provide overseas investors with greater opportunities to participate in India’s capital markets.
By raising investment limits and relaxing the eligibility, policymakers hope to channel a larger share of overseas savings into Indian capital markets.
