Union Budget 2026–27 Relaxes PMS Investment Rules for Overseas Indians

1 Feb 2026 , 12:26 PM

In the Union Budget 2026–27, Finance Minister Nirmala Sitharaman announced a key relaxation in investment norms for Persons of Indian Origin classified as Persons Resident Outside India.

Under the revised framework, PROIs will now be permitted to invest directly in Portfolio Management Services in India, without the requirement of routing investments through GIFT City. The change is aimed at simplifying the investment process for overseas based Indians and improving ease of access to India’s domestic capital markets.

As part of the relaxation, the individual investment limit for PROIs in PMS has been increased to 10% from the earlier cap of 5%, allowing higher participation at the investor level.

In addition, the aggregate investment ceiling for PROIs across a PMS scheme has been raised significantly to 24%, compared with the previous limit of 10%. The higher overall cap is expected to provide fund managers with greater flexibility to attract and deploy overseas Indian capital into domestic equity and debt strategies.

The policy move is likely to reduce compliance requirements and lower transaction costs associated with overseas investments into Indian portfolio management products.

The announcement aligns with the government’s broader objective of deepening capital markets and encouraging long term overseas investment into India’s financial system.

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