Can I invest foreign currency in India?
Yes. You can invest foreign currency in India by opening an FCNR or Foreign Currency Non-Resident Deposit Account (NRI fixed deposit accounts for depositing money earned abroad in foreign currency for a fixed period ranging from 1 to 5 years with tax-free interest) with banks facilitating investments in all the freely tradable global currencies.
You can also invest foreign currency in India through an NRE Account but the account is maintained in INR whereas FCNR deposits are maintained in the foreign currency you have chosen for deposits.
Invest Foreign Currency in India
To know more about the different types of NRI Banking Accounts that you can use and which ones are suitable for foreign currency investment in India, refer to the table below:
Types of NRI Accounts
|Factors to consider||Non Resident External (NRE) Account||Non Resident Ordinary (NRO) Account||Foreign Currency Non Resident (FCNR) Account|
For income earned outside India
|For income earned from India (pension, rent etc.)|
Foreign Currency Investment in India
USD, GBP, EUR, JPY, CAD, AUD, SGD, HKD and CHF
|Tenure of Deposits|
1 year to 10 years
|7 days to 10 years|
1 year to 5 years
Up to 7.95%*
|Up to 7.30%*|
Up to 3.05%*
(transfer of money from Indian bank account to foreign bank account)
|Both Principal (money invested initially) and Interest completely repatriable||Up to a maximum of 1 million USD per financial year||Both Principal and Interest completely repatriable|
|Tax on Interest earned (not on principal amount): 30% tax + surcharge + education cess will be deducted at the source of interest earned in India|