Central bank raises investment limits for NRIs and OCIs, broadens participation for overseas individuals and introduces measures to attract foreign capital
The Reserve Bank of India (RBI) has unveiled a series of measures aimed at boosting foreign capital inflows, including higher investment limits for Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs) and other overseas individuals investing in Indian equities.
Announcing the measures alongside the latest monetary policy decision on 5 June, RBI Governor Sanjay Malhotra said the central bank would increase the limits for investments in listed equity instruments without requiring registration with the Securities and Exchange Board of India (SEBI). The facility, previously available only to NRIs and OCIs, will now be extended to all individual Persons Resident Outside India (PROIs).
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The move is expected to simplify market access for overseas investors, reduce compliance requirements and encourage greater participation in India’s equity markets
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Detailed guidelines and revised investment thresholds are expected to be released separately
Market experts said the changes could strengthen investor confidence and widen the pool of foreign retail investors. Current regulations allow NRIs and OCIs to invest in listed Indian shares through prescribed routes without SEBI registration, while larger investments generally fall under the Foreign Portfolio Investor (FPI) framework.
In a further push to attract overseas funds, the RBI expanded the Fully Accessible Route (FAR) for government securities by including all new issuances of 15-year, 30-year and 40-year bonds. Restrictions on short-term investments, concentration limits and individual security holdings under the General Route for FPIs have also been removed.
The central bank said these measures, combined with tax incentives announced by the government, are expected to support foreign participation in India’s government borrowing programme.
Additionally, the RBI introduced temporary incentives for external commercial borrowings (ECBs) and foreign currency deposits. A concessional foreign exchange swap facility for public sector undertakings raising ECBs and a full hedging-cost support facility for banks mobilising fresh FCNR(B) deposits will remain available until 30 September 2026.
The announcements came as the Monetary Policy Committee unanimously decided to keep the repo rate unchanged at 5.25 per cent for a second consecutive policy review, while maintaining a neutral policy stance.
