India Versus Global: A Balanced Approach for NRI Investors

Rohan, a successful non-resident Indian (NRI) tech professional, believed he was taking the right steps toward financial growth by diversifying his investments.

- Tarun Birani

Over time, his portfolio expanded to include a rental property in India bought at peak prices, global ETFs (exchange-traded funds) acquired during a bull run, and high-risk debt instruments.

His Indian portfolio was equally scattered, featuring 25-30 mutual fund schemes and random stocks chosen based on tips from friends and online forums. Despite his proactive approach, Rohan's investments lacked direction.

His story highlights a common challenge faced by NRIs: balancing investments between India and global markets effectively. Rohan's strategy was reactive rather than goal-oriented. He was overexposed to high-risk assets, underinsured, and lacked contingency planning. More importantly, investments didn't align with his aspirations, such as funding his children's education abroad, creating a retirement corpus, or establishing an emergency fund.

Rohan's experience reflects a broader trend among NRIs. So, how can NRIs strike the right balance between Indian and global investments while addressing currency risks, taxation, and long-term financial goals?

Decision framework

To create a cohesive and effective investment strategy, NRIs should classify their goals into three categories: