Do NRIs are allowed to invest in Indian Stock Market?

Do NRIs are allowed to invest in Indian Stock Market? If yes what is the procedure for the same (demat account opening and online trading etc.)

All NRIs/PIOs (Person Of Indian Origin) are allowed to invest in Indian Stock Market through a special purpose vehicle proposed by the Reserve Bank Of India (RBI) called Portfolio Investment Scheme (PIS). Like a normal Indian investor the NRI also needs to have a Trading Account and Demat Account. But for banking activities he has to have a separate PIS account. To have these three types of account an NRI needs the following -
1- Designated Bank to facilitate opening of PIS Account
2- Trading Member/Broker to provide a Trading Account
3- Depository Participant to provide a Demat Account

Please check with ICICI Direct, Share Khan they provide these accounts.

It is very quick contrator. Could you please also tell me the procedure for receiving PAN also for the same.

Thanks a lot for your help.

You need to submit following documents -
a. Signed PAN Application Form 49A;
b. Two passport size photograph (size of photograph has to be “3.5 cm & 2.5 cm”);
c. The Passport copy should be duly certified by the Indian Embassy Abroad as the proof of the Identity and Residence

In case the address mentioned in your passport or driving license is other than the one you like to provide as Residence address for PAN application, then you may provide either of the following documents having that address:
- Copy of Bank Statement.
- Copy of any Utility bills.
- Copy of Passport.

More info please visit - http://www.incometaxindia.gov.in/PAN/Overview.asp

Thanks for your reply. I have got the info, I was looking for.