A Global Community of NRIs and PIOs living outside India

The Indian diaspora is one of the largest and most diverse in the world, with millions of Indian citizens living abroad. This global community, comprising Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs), has made significant contributions to their host countries while maintaining strong ties to their cultural heritage and homeland.

The Scale of the NRIs and PIOs

As of the latest data, there are over 32 million Indians residing outside of India, spread across every continent. These individuals fall into two main categories:

1. Non-Resident Indians (NRIs): Indian citizens who reside in foreign countries temporarily or permanently.
2. Persons of Indian Origin (PIOs): Individuals who were born abroad but have Indian ancestry.

Major Hubs of the NRIs and PIOs

United States: The United States hosts the largest population of overseas Indians, with approximately 4.46 million individuals. This community includes both NRIs and PIOs who are prominent in various fields such as technology, medicine, academia, and business.

United Arab Emirates: The UAE has a significant Indian population of around 3.42 million. Indians in the UAE are integral to the country’s economy, working in sectors ranging from construction and services to finance and real estate.

Saudi Arabia: Another major hub is Saudi Arabia, with about 2.59 million Indians. The Indian community here is mostly engaged in the labor market, contributing significantly to the country’s development.

Canada: Canada’s Indian population is about 1.69 million. This community is known for its cultural diversity and economic contributions, especially in sectors like technology, healthcare, and education.

Australia: Australia is home to nearly 496,000 Indians, who are known for their academic excellence and professional expertise, particularly in engineering, medicine, and IT.

Smaller Yet Significant Communities

In addition to these major hubs, there are smaller yet significant Indian communities in countries like Malaysia (2.99 million), the United Kingdom (1.76 million), and South Africa (1.56 million). These communities have established themselves over generations, preserving their cultural traditions while integrating into their respective societies.

Cultural and Economic Contributions

The Indian diaspora is celebrated for its cultural richness and economic contributions. Festivals like Diwali and Holi are celebrated with great enthusiasm across the globe, showcasing India’s vibrant traditions. Additionally, Indian cuisine, Bollywood films, and classical arts have gained international acclaim, enriching the cultural fabric of many countries.

Economically, Indians abroad are known for their entrepreneurial spirit and professional expertise. They have founded numerous successful businesses and startups, significantly contributing to the economies of their host countries. Moreover, remittances from the NRIs and PIOs are a vital source of income for India, helping to boost the national economy.

Challenges and Opportunities

Despite their successes, Indians living abroad face various challenges, including cultural assimilation, racial discrimination, and visa restrictions. However, the global Indian community remains resilient, continuously striving for progress and recognition.

Many countries are recognizing the value of skilled immigrants and are creating pathways for easier immigration and integration. Furthermore, initiatives by the Indian government, such as the Overseas Citizen of India (OCI) card, have strengthened the connection between India and its global community, providing better access to opportunities in India

Taxation implication of NRIs and PIOs

Under the Income Tax Act of 1961, when a person living outside India attains non-resident status, the income earned, accrued, or received outside India is not taxable in India. No overseas income is taxable in India for non-residents. When NRIs or PIOs return to India to spend their remaining lives peacefully with their family and relatives, the income they earned while being non-residents does not become taxable in India.

Initially, upon returning, NRIs and PIOs are granted the status of Non-resident, later after living few years they become Resident but Not Ordinarily Resident (RNOR) and they then transition to Resident and Ordinarily Resident (ROR) status. While they hold RNOR status, any income earned outside India is not taxable in India.

Global income becomes taxable in India once an individual attains ROR status. However, they can claim the benefit of foreign tax credit for any taxes paid outside India under the Double Taxation Avoidance Agreement (DTAA). India has signed over 90 DTAAs with other countries to prevent double taxation, providing significant relief for NRIs and PIOs.

Here is the most recent data from the Ministry of External Affairs portal, showing the numbers of NRIs and PIOs living abroad.

Source: https://www.mea.gov.in/population-of-overseas-indians.htm