Budget 2026: What Did Nirmala Sitharaman Offer NRIs? Bigger Equity Access, Simpler Tax Rules

Finance Minister Nirmala Sitharaman unveiled key measures in the Union Budget 2026 to expand investment opportunities and ease compliance for Persons Resident Outside India (PROIs), including NRIs. A major highlight is the expansion of the Portfolio Investment Scheme (PIS), aimed at deepening foreign participation in Indian equity markets.

Bigger Equity Investment Limits for Overseas Indians

Under the proposal, a single PROI can now invest up to 10% in the equity instruments of a listed Indian company, up from the earlier 5% limit. The aggregate investment cap for all such overseas individual investors in a company has also been raised to 24% from 10%. Currently, PROIs invest through FDI or FPI routes, and the enhanced PIS framework offers more direct access to Indian equities.

Experts see this

as a strong signal that India wants to diversify foreign participation beyond large global institutions. Sonam Srivastava, Founder and Fund Manager at Wright Research PMS, said the move widens the ownership base of Indian equities while keeping systemic risks in check through overall caps. The change is expected to improve liquidity, enhance price discovery and attract long-term capital from the Indian diaspora.

Buying property from an NRI? TDS rules will now get simpler

The Budget also tackled a long-standing compliance issue in property transactions involving non-resident sellers. Earlier, resident buyers had to obtain a Tax Deduction and Collection Account Number (TAN) solely to deposit TDS when buying property from NRIs, even for one-time deals.

Now, TDS on such transactions can be deducted and deposited using the buyer’s PAN-based challan, removing the need for TAN registration. This aligns the process with property purchases from resident sellers and is expected to reduce procedural delays and errors.

Tax and legal professionals have termed the move a practical reform. Raheel Patel of Gandhi Law Associates called it the removal of a purely procedural irritant. Alay Razvi of Accord Juris said it would significantly reduce errors and litigation exposure. Rajarshi Dasgupta of AQUILAW added that the step rationalises the compliance framework, cuts administrative friction and improves ease of doing business without weakening tax oversight.

Disclosure Window for Foreign Assets

FM Sitharaman also proposed a six-month disclosure window for small taxpayers — including students, tech professionals and relocated NRIs — to voluntarily declare foreign assets and regularise tax compliance. The measure aims to encourage transparency while offering a structured compliance path.

Together, these steps reflect a broader push to make India’s financial ecosystem more accessible to overseas Indians. By combining higher equity investment limits with simplified tax procedures, Budget 2026 signals a calibrated approach — encouraging global Indian participation while maintaining regulatory safeguards.