Can Commercial Property in India be purchased by an NRI?

Can Commercial Property in India be purchased by an NRI?

This is a question that has come up again and again, and with this has come some other relevant questions, too, like if NRIs can buy commercial property in India, what kind of properties can they buy? What procedures should be followed? And many more. So in this article, we shall answer some of these questions by taking into consideration RBI guidelines.

Can an NRI buy commercial property in India?

The answer is Yes! NRIs can buy commercial property in India. As per RBI guidelines, a non-resident Indian can buy specific types of properties in India. However, it is worth mentioning here that it is also possible to purchase other types of properties after obtaining special permission for the same.

An NRI who buys property in India should be fully known to the legal provisions that pertain to owning an immoveable asset within the country. According to the provisions of the Foreign Exchange Management Act, persons of Indian Origin and NRIs are treated as one and the same when it comes to investing in real estate in India.

Types of Properties that Non-Resident Indians can buy

The Reserve Bank generally allows Non-Resident Indians/Persons of Indian Origin who are in a possession of a valid Indian passport to purchase residential or commercial properties in India. In that case, the investor is not required to obtain RBI’s special permission for it.  The investor is also not required to intimate the reserve bank regarding the purchase of residential/commercial property in India.

A Non-resident Indian may buy any number of properties according to the regulations of the Reserve bank of India and income tax laws. In case the NRI investing in a residential/commercial property in India is unable to come to the country again, and again then the purchase can be done by giving a legally binding power of attorney to another person. 

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Types of Properties that Non-Resident Indians can’t buy

However, there are certain types of properties that can’t be bought by Non-Resident Indians/Persons of Indian Origin. RBIs general permission doesn’t allow NRI to buy agricultural land/plantation in India. It means that NRIs can’t invest in farmhouses without getting special permission from the Reserve bank, which is not guaranteed.

The Reserve Bank shall consider such applications on case to case basis only and then decide whether to allow NRIs to buy such property or not.

Essential points to be followed by an NRI to buy a property in India

The following points must be noted by an NRI-

  • As per the RBIs general authorization, an NRI can buy a property either individually or mutually with another NRI. The most effective way of buying property is adopting a Power of Attorney.
  • Appoint a power of attorney who would be your personal legal councilor and would also suggest you all matters pertaining to the real estate and all the other formalities as he is an expert in the field. This method has been employed by many as it’s cost-efficient and effective.
  • Considering that he is familiar with Indian laws and the real estate market, he would be able to assist you with the best deals also. It is also advised further to appoint the General Power of Attorney or Special Power of Attorney whom you think is reliable as it would be easy to communicate.

Entry strategies for investing and setting up a company in India

Foreign nationals entering into the Indian territory should carry a valid passport/travel documents and a valid visa. Visas could be for the purposes of tourism, entry, transit, conferences, business, and employment in India, which is re-issued to foreign nationals by Indian embassies and consulates abroad.

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Business visas can be issued for a 5 year period with multiple entry provisions. A business visa is issued by an Indian embassy abroad, and if the applicant desires, it can be renewed/extended within India.

A foreign national having a visa (apart from a tourist visa) that is valid for a period more than 180 days should be registered with FRRO within 15 days of arrival in India. A bank guarantee should be provided.

Class of investors that come from outside the territory of India

The classes of investors who come from outside the Indian Territory to make investments here include the following:

Class of investors that come from outside the territory of India - Commercial Property in India

Automatic route of Foreign Investment in India

The automatic route means the route which doesn’t require a prior approval from the government for foreign investment. Neither from the government nor from the RBI. However, the investors should notify the concerned regional office of RBI within 3 days of receipt of inward remittances.


To sum it up, it can be said that NRIs can buy commercial property in India however the buyer should be aware of various legal requirements pertaining to owning an immoveable property in India. Further, if you are an NRI and can’t travel to Indian often, then also you can purchase property in India by giving a legally binding power of attorney to another person.

Read our article:Acquisition of Immovable Property in India and outside India as per FEMA Guidelines by Foreigners/NRI and PIO

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