The Ministry of Finance (Department of Economic Affairs), through Notification No. S.O. 3030(E) dated June 12, 2026, has notified the Foreign Exchange Management (Non-debt Instruments) (Third Amendment) Rules, 2026 (“Amendment Rules”), amending the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 (“NDI Rules”).
The Amendment Rules significantly expand the portfolio investment framework under the NDI Rules by extending the investment regime previously available only to Non-Resident Indians (“NRIs”) and Overseas Citizens of India (“OCIs”) to all individual persons resident outside India. It also aligns investments by such individuals with the broader FPI and FDI framework, while introducing enhanced safeguards relating to ownership, control and beneficial ownership.
Collectively, these changes seek to facilitate broader participation by foreign investors in Indian capital markets while maintaining regulatory safeguards aimed at ensuring transparency, accountability and oversight of cross-border investments.
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