NRI – Invest in Farmhouses in India?

Important Insights You Should Know –

NRI – Particularly if You’re Considering a Farmhouse Plot in Pune

If you’re an NRI who has just come back to India, investing in property might be at the top of your agenda. Of the numerous possibilities, farmhouse plots, particularly in picturesque locations such as Pune, provide a perfect combination of personal getaway and investment opportunity.

But can NRIs legally invest in farmhouses in India? The answer isn’t straightforward — and that’s why we’ve broken it down for you.

Understanding the Basics: Can NRIs Buy Agricultural Land or Farmhouses?

Under present FEMA (Foreign Exchange Management Act) laws, PIOs and NRIs are not permitted to purchase farmhouses, plantation land, or agricultural property in India. Such land is only available to Indian citizens.

Yet, there are exceptions and circumnavigations. Here’s what you must keep in mind if you are an NRI (or a returning NRI) who wishes to invest in a farmhouse plot:

1. The 182-Day Rule: Are You a Resident Yet?

The first key consideration is your residency status.

If you remain in India for over 182 days during a financial year, you might be declared a resident for tax purposes. Such a change in status can unlock some real estate investment options which are otherwise closed for NRIs — including buying farm or agricultural land.

2. Permanent Employment in India Strengthens Your Position

If you’ve secured permanent employment in India, it can further establish your intent to reside here. This not only influences your tax status but also supports your eligibility to invest in land typically restricted to residents.

In other instances, a secure job profile might simplify the process of securing necessary approvals or funding for farmhouse ventures.

3. A Long-Term Stay Could Change the Game

Even if you’re not yet a resident full-time, planning a long-term stay in India might facilitate your transition in status. After becoming a resident, the limitation on buying farmhouse plots might not apply anymore.

Pune, for instance, has multiple agricultural zones where Indian residents are permitted legal ownership — an attractive proposition for such investment.

4. Establishing a Permanent Business in India

Setting up a permanent business in India would also come in handy.

By establishing a registered business or farming company, you might be able to buy land in the company’s name, subject to state-level legislation and usage permissions. Although this path is complicated and involves extensive legal consultation, it’s one some repatriated NRIs follow.

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– 

Reshma Haajite

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