Investing in India’s Financial markets

Investing in India’s equity markets was not easy. For the longest time, US nationals could trade in India’s equity markets only through ADRs (American Depository Receipts). Very few companies had their equities listed as ADRs so there wasn’t much to choose from. Recently the Reserve Bank of India has formulated rules that allow everyone to invest in its stock markets and other financial instruments. The Reserve Bank of India (equivalent of US’s Federal Reserve) formulated new rules that allow everyone to trade in India’s equity markets. The first detailed publication came from SEBI in January 2014 and these rules got further clarified in October 2014. The long and short of it is that now everyone can:

  • Trade in Securities and Derivatives markets in the India
  • Participate in buying and selling Shares and Debentures in the Indian Share Market
  • Can also invest in government securities and corporate debt subject to limits specified by the RBI and SEBI(Securities and Exchange Board of India) from time to time

Non-Resident Indians cannot invest under the FPI scheme but they can do so under the PIS scheme. Here is a step-by-step approach on how to do so. There is additional information on the Online trading platforms available as of today.

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