Non Resident Indian Banking

Okay, if you haven't already worked it out, NRI stands for Non-Resident Indian. To qualify as an NRI you can be originally born in India or the child or grandchild of someone born in India (before India was divided)

Banking as an NRI offers you certain tax priviliges which are not available to Resident Indians. This is done as an incentive for investment.

There are broadly two accounts available, the NRO and the NRE accounts. NRO stands for Non-Resident Ordinary and NRE stands for Non-Resident External.
The Ordinary account (NRO) can accept Indian Rupees and any income created within India. Interest is also taxed by the Indian Government. This money cannot be converted into foreign currency, taken outside of India or placed into an NRE account.
The External account (NRE) can only be funded from foreign currency which is then converted to rupees at the current exchange rate. This money can then be used within India but can also be repatriated back to the original foreign currency along with the interest earned. If you opened the NRE account when the rupee was weak and then reptariated the money when the rupee became stronger then you would also benefit financially in addition to any interest earned. Obviously you've got to get this right to gain from this. If you don't want to take that risk there are also FCNR accounts available where the money remains in the foreign currency invested and is not converted to rupees. The FCNR account is a form of NRE account and also exempt from Indian Government tax.
Just a few years back Indian Interest rates were very high, especially compared to the very low rates in the UK and USA currently, which made these accounts very attractive but the rates have since dropped. In 2005 you're looking at getting about 4.5% interest on a savings account.

Under Construction - sorry, been a bit busy to get things sorted. Please come back soon.