An NRI is a person of Indian origin, birth or descent who lives in India for less than 182 days during the preceding financial year as per India’s Foreign Exchange Management Act 1999 (FEMA). A person may be residing outside India for employment, business, etc., for an indefinite period.

POI or a Person of Indian Origin is a foreign citizen (except nationals of Pakistan, Afghanistan, Bangladesh, China, Iran, Bhutan, Sri Lanka and Nepal) who at any time held an Indian passport or either of their parents/grandparents/great-grandparents were born and permanently resident in India as defined in Government of India Act, 1935 and other territories that became part of India after that provided neither was at any time a citizen of any of the countries described above (as referred above)
Or is a spouse of a citizen of India or a PIO.

In the Republic of India, the following categories of people can purchase immovable property in India:
i) Non-Resident Indian (NRI) – that is a citizen of India resident outside India
ii) Person of Indian Origin (PIO) – that is an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan), who 1. At any time, held Indian passport, or 2. Who or either of whose father or grandfather was a citizen of India by the Constitution of India or the Citizenship Act, 1955 (57 of 1955).

NRIs are restricted from buying agricultural lands, plantation properties, or farmhouses unless an inheritance or a gift to the NRI person. However, there is no restriction on the number of residential and commercial properties that an NRI person can purchase.

An NRI requires the following documents to purchase a property in India:
Power of attorney in the name of someone in India who can carry out legal & financial proceedings on your behalf.
PAN Card
In case your PAN card is not available, then a copy of your passport.
An NRE or NRO account via which you can transact with the builder.
Address proof
Passport size photographs

To encourage foreign remittances in India, the government has allowed several attractive property loan facilities for the NRIs by several banks.

All the transactions have to be conducted in Indian currency and through banks located in the country. This requires the individual to have an NRI account in an authorized Indian bank.
As all the transactions are carried through the banking channels in India, the NRI should make use of the NRO/NRE account for all inward remittances. One can also issue post-dated cheques or ECS from any accounts like NRE, NRO or even FCNR.

NRI investing in properties in India can claim a deduction of Rs one lakh under Section 80 C of the Income Tax Act, 1961. As far as the transactions regarding real estate are concerned, short-term capital gains apply to the profit earned through the sale of a property within two years of its purchase. The capital gains for such property are calculated as the difference between the sale proceeds and the acquisition cost. It is taxed as per the applicable slab rate for the NRI.
The long-term capital gains (applicable when the property is held for more than two years) are taxed at 20%. However, unlike short-term capital gains, the exemption can be claimed under sections 54, 54 F and 54 EC.