Non-resident Indian (NRI) equity participation has tripled since FY19, with active accounts reaching 957,000 and total holdings touching ₹5.6 trillion by July 2026. This growth follows government moves to raise individual investment limits to 10 per cent and improve digital onboarding at GIFT City. Investors should note that these regulatory updates aim to simplify complex Portfolio Investment Scheme processes, potentially attracting more diaspora capital into domestic markets.
Non-resident Indian (NRI) participation in Indian stock markets has seen a major rise, with total holdings reaching ₹5.6 trillion by July 2026. This represents a significant increase from ₹1.5 trillion in FY19. Data from depositories confirms that the number of active NRI investor accounts has climbed to 957,243, up from 314,966 in the same period. The rise comes after regulatory updates aimed at making it easier for non-residents to invest in Indian equities.
The government, following directives from the Reserve Bank of India, has increased the investment limits for non-residents. The individual investment cap has been raised to 10 per cent from the previous 5 per cent limit. Additionally, the aggregate investment ceiling has been adjusted to 24 per cent, up from 10 per cent. These changes were part of the February Union Budget and are designed to formalize and streamline the entry of diaspora capital into the Indian market.
While this growth is positive, systemic hurdles have historically made direct equity investment difficult. The Portfolio Investment Scheme, which manages these investments, has often involved slow, bank-mediated reporting and limited digital options for new investors. To address these issues, the International Financial Services Centres Authority (IFSCA) is working on structural reforms to make the process more seamless.
Gujarat International Finance Tec-City (GIFT City) is becoming the central hub for this expansion. By providing a more favorable compliance environment and lower costs, it is attracting funds that might have otherwise avoided the domestic retail route. Investments linked to the diaspora in GIFT City grew from $536.2 million in the quarter ended September 2025 to $851.1 million by June 2026.
The IFSCA is currently proposing a unified unique identification number for KYC processes. This would allow investors to use verified credentials across multiple regulated entities, which could remove the administrative blocks that currently limit client acquisition. Moving forward, investors should monitor the progress of these digital onboarding reforms. The long-term impact on market liquidity and stability will depend on how quickly these bureaucratic friction points are reduced, allowing for smoother capital flows from the diaspora.