To cushion the economy against the long-running geopolitical conflict in West Asia, the Reserve Bank of India (RBI) is eying to pump more investment into India’s capital markets from Indian Diaspora. RBI Governor Sanjay Malhotra has introduced significant relaxations in investment regulations for overseas Indian-origin investors. The new RBI rule for NRIs and OCIs makes it easier for them to invest in Indian stocks, raises investment limits, and expands access to a larger group of foreign nationals.
New RBI policy for NRI and OCI investors
On 5 June 2026, RBI announced a major update to the investment framework for overseas investors. The individual investment limit for an NRI or OCI Cardholder in listed Indian companies has been doubled from 5% to 10% without needing SEBI registration, and the aggregate investment limit has been increased from 10% to 24%. These new RBI rules for PROIs (Person Resident Outside India) apply to investments made through the Portfolio Investment Scheme (PIS), giving overseas investors greater room to participate in India’s growth story.
Who can invest in Indian stocks under the new rules
RBI has expanded the scope of eligible investors under the revised framework. In 2026-27, the relaxed investment norms will benefit not only NRIs and OCI Cardholders, but also individual Persons Resident Outside India (PROIs), including foreign nationals. RBI’s inclusion of foreign nationals broadens access to India’s stock markets and opens the door to an influx of overseas investment.
Do NRIs and OCIs need SEBI registration in 2026
Earlier, overseas investors, mainly NRIs and OCIs, needed SEBI registration to own more than the standard RBI limit of 5% of the equity of a listed Indian company. Any exposure to Indian equities beyond the stipulated 5% required them to tread the more complex Foreign Portfolio Investor route (FPI). Under the updated investment norms, RBI raised the limits and relaxed the SEBI registration requirement up to 10%. However, the SEBI-regulated FPI framework is still mandatory for NRIs, OCIs, and any foreign investors seeking greater exposer to India’s money markets beyond 10%.
A win-win situation for India and PSOIs
Market analysts and economists have welcomed RBI’s investment reforms for overseas investors. They believe the revised investment limits, the inclusion of non-Indian-origin foreign nationals, and the relaxed access to India’s stock markets would pump more foreign investments into India. Indian Diaspora’s more active participation would boost global investors’ confidence in India’s listed companies. RBI’s new investment norms make it a win-win situation for both India and PSOIs.
