Money Matters: 6 Benefits Of Investing In India That NRIs Must Know About

Non-Resident Indians (NRIs) often wonder if it is a safe idea to invest in India. To put your doubts to rest, we connected with Lakshya Narula, a finance contentcreator who helped us understand the benefits that NRIs would have if they decide to invest in India.

He said, “India has been experiencing remarkable and consistent economic growth, making it an attractive destination for investments. This progress has created numerous opportunities for Non-Resident Indians (NRIs) to tap into India's expanding potential.”

He added, “With effective governmental reforms, a thriving startup ecosystem, and a skilled, young workforce, India stands among the world's fastest-growing economies, poised for further development.” Narula also said that the Indian government has made significant efforts to enhance the ease of doing business and attracting international investments.

In May 2022, SB NRI, a fintech platform, published a report that stated 50% of NRIs who invest in commercial real estate are millennials. In India Mumbai, Pune and Bengaluru top the list of places where NRIs invest in properties. Aryaman Vir, Founder and CEO of MYRE Capital (an assets and technology platform) was quoted saying, “40% of our NRI user base are women, we believe increasing awareness and access to Grade-A properties will make more NRIs explore this asset class”.

If you are confused about investing in India, Narula has shared a few benefits that NRIs must know about.

Growing Consumer Base

With a population of around 1.5 billion, Indian citizens make up for a huge consumer base with growing purchasing power. Narula said, “Rising disposable incomes, changing lifestyles, and urbanisation create investment opportunities in sectors such as retail, consumer goods, healthcare, and entertainment, catering to the evolving demands of Indian consumers.”

Emerging Startups And Advancing Technology

India is a hub for advancements in technology and emerging startups. It sees new developments and innovations every day. Therefore, NRIs can invest in technology-driven companies, startup incubators and venture capital funds. It will help them capitalise on the entrepreneurial ecosystem and it has the potential for a high Return on Investment (ROI).

Cultural And Economical Connections

Narula added that investing in India can provide NRIs with a sense of belonging and help them stay connected with the culture via economic means. It will also allow them to participate in the growth of the country and contribute to its progress.

Exchange Rate Opportunities

Since exchange rates between the Indian rupee and home currency (source currency) are always fluctuating, NRIs can take advantage of this opportunity. Narula said, “If their home currency strengthens against the Rupee, it can enhance returns when converting investments back into their home currency.”

Diversification Of Portfolio

The finance content creator said investing in India can help NRIs todiversify portfolio geographically. By allocating funds to the Indian market, NRIs can reduce their exposure to a single country or region. It can help mitigate risks and enhance portfolio performance.

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Economic Growth Potential

Being one of the fastest-growing economies in the world, the Indian market offers a significant potential for different types of investments.

Narula added, “With a large consumer market, a growing middle class, and ongoing economic reforms that foster business expansion and entrepreneurship, investing in India allows NRIs to capitalise on this growth and potentially achieve higher returns compared to more mature markets.”

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If you are someone living in the Middle East where the equity market is less developed as compared to Australia, the USA or the UK, investing in Indian equities can help with financial planning. You can also connect with professional fund managers who can help you with convenient repatriation options.

There is a benefit involved for Indians when NRIs invest here. It can help with the growth country’s domestic market and foster an increase in liquidity.

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