New Delhi:
Individuals living abroad can now invest in Indian stocks through the Portfolio Investment Scheme, Finance Minister Nirmala Sitharaman announced Sunday, presenting the Union Budget 2026. This is her ninth consecutive Budget speech under the Prime Minister Narendra Modi-led government.
The announcement comes at a critical juncture for Indian stock markets. Foreign investors pulled out Rs 19 billion in 2025 and another Rs 4 billion in January 2026, as currency weakness and lower post-tax returns make Indian investments less attractive compared to safe returns abroad.
“This Budget comes at a very crucial juncture as far as markets are concerned,” said Nimesh Chandan, Chief Investment Officer at Bajaj Finserv Asset Management Limited, ahead of the Budget. “The most important area to watch will be the steps the Finance Minister takes to attract durable FDI and FPI flows into the economy.”
The Portfolio Investment Scheme allows non-resident Indians and foreign investors to buy and sell Indian stocks through a special bank account approved by the RBI. It sets investment limits, usually 5% per individual and 10% total per company, and ensures all transactions follow regulatory rules. Funds invested can be repatriated.
Other measures for non-resident investment announced in Budget 2026-
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Raising the individual investment limit for Persons Resident Outside India (PROIs) from 5% to 10%.
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Increasing the overall investment limit for all PROIs from 10% to 24%.
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Allowing residents living abroad to invest in Indian equities via a portfolio route.
The Finance Minister proposed a Rs 5,000 crore outlay for the City Economic Regions scheme. She also announced a review of Foreign Exchange Management Act (FEMA) rules related to non-debt instruments.
