Purchase agricultural land in India by NRIs – foreigners


Purchase agricultural land in India
  • Foreign people cannot Purchase agricultural land in India. This applies to the entire country. No state in India allows foreigners to buy agricultural land.
  • NRIs cannot buy agricultural land in India. Yes! All over India, the same rule applies as above. The approval is not readily available from the Reserve Bank of India, which depends on the individual circumstances.
  • Also, some governments in India have rules that allow farmers to buy agricultural land in their country, but this also limits Indian citizens to buy agricultural land.
  • OCI holders resident in India due to their OCI status are still foreigners and should recognize that OCI grants them visas to stay in India but do not give them Indian citizenship. They still hold foreign passports
  • NRIs and foreign nationals of Indian origin cannot purchase agricultural land in india as a gift. You can only buy agricultural land through inheritance.

Can NRIs purchase agricultural land in India ?

Do foreign citizens need to sell agricultural land they previously owned? This is a question often asked by non-residents who already had agricultural land before modifying their residential status.

NRIs who have acquired foreign citizenship are sometimes misled to believe that they cannot keep agricultural land because foreigners cannot have their agricultural land in India. That is not true.

While foreigners cannot acquire agricultural land, NRIs who acquire foreign citizenship can continue to hold agricultural land or other assets in India provided they have obtained them legally before accepting foreign citizenship.

Check with the authorities before you have a problem. Money, which is legal, can now be legally transferred abroad.

Do not fall victim to illegal money transfers. 

Warning on the purchase of reconverted agricultural land

As property prices in India are escalating, interest in the purchase agricultural land in India has risen in recent years. Non-resident Indians (NRIs) who had left India a few years ago are, of course, also interested in buying cheaper land in India. The Purchase agricultural land in India by NRI is one of the questions we often get on my NRI FAQ pages.

Although it is a well-known fact for many NRIs that they cannot legally buy agricultural land according to the current regulations in India, to assume that anything is possible in India remains in the minds of people. Some people feel that NRIs can purchase agricultural land in India.

A new concept for the sale of arable land by some brokers in India is to tell NRIs that the farmland can easily be converted back into residential areas once they have bought it. Some may even take a look at documents that can show that the country has already been rebuilt, and this may or may not be true.

Here are a few things to keep in mind when you think of buying agricultural land in India with the idea to rebuild for residential or business use later.

  1. To legally obtain agricultural land referred to as residential area is not as easy as some land brokers to impress potential buyers. While they promise that they should get the paperwork done for you after buying, whether you should take their words at face value, we leave this decision to you.
  2. Each state has its rule on the conversion of agricultural land, check with the authorities before giving away your money.
  3. If you are given an opportunity to acquire land that has already been converted from agricultural land to residential areas, check the documents not only at nominal value but also at the relevant municipal authorities for a period. The person who is taking the land must use the converted area for the purpose for which the land was converted within a period of time, or the conversion becomes void

Can an NRI with a PIO card buy a “converted” agricultural land – Converted to ‘Residential’?

NRIs can easily buy residential or commercial real estate. As long as the country is referred to as residence when you buy it, there should be no problem.

We are not sure where in India you are planning to buy the land that has been converted to a housing land from agricultural land. But we would like to mention a few things.

While each state has its set of rules, sometimes there is a deadline to grant the benefits of conversion. There is also the possibility that the converted land cannot be legally transferred. For example, in Rajasthan, unless the purpose for which the land is converted is not carried out in two years, the permit is canceled, and the land goes back to agricultural.

Use of land after conversion – Any agricultural land used for a non-agricultural purpose will be used for converted purposes for the period of two years from the date of issue of the conversion contract for which the conversion contract is drawn.

The amount of the premium paid to the state government, provided

  • that the period of two years may be extended by one year by the next higher authority if that higher power is satisfied.
  • that an opportunity to be heard must be given before a condemnation of the delay of the premium.

Agricultural land converted into residential areas may not be transferred two years after conversion is granted.

  • Transfer of land which has been converted for non-agricultural purposes – All land which is properly converted for non-agricultural purposes under these rules (may not be transferred within two years after such conversion after two years) may be transferred without premium payment or permit from the prescribed authority.
  • Provided that the transfer of the land may be affected by leasing or mortgage to obtain loans from the government or the Land Development Bank as defined in the Law of Rajasthan Cooperatives, 1965 (Act 13 of 1965) or a cooperative society Registered or registered as registered that vide, said that or any proposed bank or Rajasthan Finance Corporation, Rajasthan State Industrial Development and Investment Corporation Limited or any other initiative notified by the state government on that behalf.

Since you have the documents confirming the conversion from agricultural to residential land, check them carefully to see if there are any strands attached to selling the land.

In the conversion of the property, the owner of the property will fulfill a purpose by completing an application form and proof of the landed property for the conversion. When buying converted land, the buyer should request for all documents such as copies of the original application for the conversion of land from agricultural to housing.

Get your documents verified by a lawyer. Land registration documents, property rights, etc. are to be confirmed by the relevant authorities in India.

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Purchase agricultural land in India by NRIs – foreigners

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