A. As an NRI or a PIO, you are allowed to invest both in Indian stocks as well as Indian mutual funds. However, for investing in stocks you require what is known as a PINS permission from RBI. Under PINS, you can have only one NRE and/or NRO account linked to your demat account. All your trading activity has to be done through this specific bank and demat account. The PINS permission is acquired on your behalf by the bank in which you choose to have the bank and demat account. Also, as an NRI, you are not allowed to short sell, you have to take delivery and give delivery of buying and selling transactions, respectively.

Investing in mutual funds on the other hand is fairly straightforward in as much as NRIs and PIOs have general permission of RBI to buy and sell units. In other words, for transacting in mutual funds, PINS is not required, you may invest just by filling out the form of the relevant scheme and attaching the cheque therewith.

Note that for both, stocks as well as mutual funds, having a PAN is mandatory