Can an NRI open a demat account?

Yes, an NRI can open a demat account in India, but it must be specially designated for NRI use. There are two types: NRE demat account for investments made with foreign income (fully repatriable) and NRO demat account for investments using income earned in India (partially repatriable).  

To invest in Indian equities, the NRI must also have a Portfolio Investment Scheme (PIS) permission from the RBI through a designated bank. This allows NRIs to buy and sell shares on Indian stock exchanges. The demat account must be linked with the NRI’s NRE/NRO bank account and the PIS approval.