Obtaining Permanent Residency Status in India: A Comprehensive Guide for Expats

Overview of Permanent Residency Status in India

Permanent Residency Status (PRS) is a scheme introduced by the Indian government to attract foreign investors who wish to invest in the country under the Foreign Direct Investment (FDI) route. PRS grants foreign investors a multiple entry visa without any stay stipulation for an initial period of 10 years. This can be further extended for another 10 years, subject to certain conditions.

Please note that PRS is not applicable to Pakistani citizens or third-country nationals of Pakistani origin.

Eligibility Criteria for PRS

To be eligible for PRS, foreign investors must fulfill the following conditions:

• Invest in India under the FDI route, subject to relevant conditions specified in the FDI policy notified by the Department of Industrial Policy and Promotion (DIPP) from time to time. This would apply to foreign investment in a new company or an existing/operating company.
• Invest a minimum of INR 10 crores (approx. USD 1.5 million) within 18 months or INR 25 crores (approx. USD 3.75 million) within 36 months.
• The foreign investment should result in generating employment for at least 20 resident Indians in every financial year.

Only foreign investors fulfilling the above-mentioned eligibility conditions, along with their spouse and dependents, can apply for PRS. Top management executives and Promoters/Directors of the foreign company investing in the Indian company are not covered under this scheme and will need to obtain a regular Employment Visa.

Benefits of PRS

Holding PRS in India comes with several advantages, including:

• Multiple entry visa without any stay stipulation.
• Exemption from registration requirements with the Foreigners Regional Registration Officer (FRRO)/Foreigners Registration Officer (FRO).
• Permission to purchase one residential property for dwelling purposes (subject to compliance with FEMA Regulations).
• Spouse and dependents of the investor granted PRS can take up employment in the private sector with permission from the FRRO/FRO.
• The minimum salary limit of INR 16.25 lakhs per annum prescribed for grant of Employment Visa to foreign nationals will not be applicable in such cases.
• Spouse and dependents of the investor granted PRS can undertake studies in India without a separate Student Visa.

Application Procedure for PRS

Foreign investors promising investment as per the specified threshold limits will be granted an initial business visa, labeled as 'B-4 Visa (Investor)', for 18 months or 36 months, depending on the level of investment promised. This visa will be issued without any stay stipulation, and there will be no requirement of registration with the FRRO/FRO concerned.

Spouse and dependents of the investor will be granted a 'B-4X' Visa co-terminus with the Business Visa of the investor, subject to the same terms and conditions.

After fulfilling the eligibility conditions in terms of investment and employment, the foreign investor, along with their spouse and dependents, must submit an application for PRS online to the FRRO/FRO concerned. The following documents need to be submitted along with the application:

• Copies of Passport and Visa
• Photograph
• Residence Proof
• Copy of Form FC-GPR
• Annual Return on Foreign Liabilities and Assets filed with RBI by the Indian company receiving FDI
• RBI's acknowledgement letter
• Income Tax Return filed before the Income Tax Department in support of the fulfillment of the eligibility conditions for PRS

Grant of PRS is subject to prior clearance from the Ministry of Home Affairs (MHA). Once the clearance process is complete, the applicant must approach the concerned Indian Mission/FRRO/FRO for verification of the documents with originals and biometric data collection.

Validity and Renewal of PRS

PRS is granted for a period of 10 years with multiple entry privileges. It can be renewed for another 10 years if the PRS holder has not come to adverse notice and continues to fulfill the investment and employment conditions.

Reporting and Compliance Requirements for PRS Holders

Foreign investors holding PRS are required to submit the following documents to the FRRO/FRO concerned every year:

• Copy of Form FC-GPR, Annual Return on Foreign Liabilities and Assets filed with RBI by the Indian company receiving FDI, and RBI's acknowledgement letter.
• Income Tax Return filed before the Income Tax Department.
• Details regarding employment generation for resident Indians, based on self-certification by the statutory auditor of the Indian investee company.

Additionally, PRS holders staying in hotels or lodges must ensure that the hotel/lodge submits Form 'C' (Appendix V) to the FRRO/FRO concerned. PRS holders must also inform the FRRO/FRO about any change of address or change of passport.

Acquisition and Transfer of Immovable Property by PRS Holders

PRS holders are allowed to purchase one residential property for dwelling purposes in India. However, the transfer of immovable property acquired by PRS holders under the PRS scheme must comply with the provisions of Foreign Exchange Management (Acquisition and transfer of Immovable property in India) Regulations, 2000.

Employment and Education Opportunities for Spouse and Dependents of PRS Holders

Spouse and dependents of the investor who are granted PRS can take up employment in the private sector in India, with the permission of the FRRO/FRO concerned. The minimum salary limit of INR 16.25 lakhs per annum prescribed for grant of Employment Visa to foreign nationals will not be applicable in such cases.

They must, however, inform the concerned FRRO/FRO about the details of the institution, duration, and subject of the course before undertaking studies in India.

Revocation of PRS

PRS can be revoked by the FRRO/FRO, subject to the recommendation of the Ministry of Home Affairs (MHA), in the following cases:

• Failure to meet the conditions relating to investment and employment generation
• Willful default as per guidelines issued by RBI or any other relevant law
• Declaration of unsound mind by a competent court
• Undischarged insolvency
• Conviction by a court of law for any offense
• Any other reasons that make the continued stay of the investor in India undesirable

Upon revocation of PRS, the investor and their spouse and dependents must leave India within three months of the date of the revocation order.

Additionally, the PRS holder must dispose of the immovable property in accordance with the extant FEMA Regulations within a reasonable time, not exceeding one year.

Conclusion

Obtaining Permanent Residency Status in India can provide numerous opportunities and benefits for expatriates looking to invest and settle in the country. This comprehensive guide has covered the eligibility criteria, benefits, and procedures for obtaining PRS, along with the essential forms and guidelines. With the right approach and guidance, you can successfully navigate the PRS application process and make India your long-term destination for investment and growth.