NRIs and OCI cardholders cannot buy agricultural land, plantation property or farmhouses anywhere in India, including farm plot projects around Hyderabad. The bar comes from Rule 24 of the FEMA (Non-debt Instruments) Rules, 2019. You can inherit such land, keep land bought while resident, and buy residential or commercial property freely.
The rule, in plain terms
Under the Foreign Exchange Management Act, 1999 and the Foreign Exchange Management (Non-debt Instruments) Rules, 2019, an NRI or an Overseas Citizen of India has general permission to acquire immovable property in India, other than three categories: agricultural land, plantation property and farmhouses. The official FAQ on acquisition of immovable property states plainly that general permission is not available for these, so proposals to buy them are not permitted under that route.
The restriction is about the type of land, not about you. The same NRI who cannot buy an acre of farmland in Chevella can buy any number of apartments in Gachibowli without Reserve Bank of India approval.
What you can and cannot do
| Action | Allowed? | Notes |
|---|---|---|
| Buy agricultural land, a farmhouse or plantation | No | Applies to every state, including Telangana |
| Receive such land as a gift | No | Gifts from relatives are permitted only for property other than these categories |
| Inherit such land | Yes | From a person resident in India, or from a person who held it lawfully |
| Keep land bought while you were resident | Yes | Becoming an NRI does not force a sale |
| Sell inherited or previously owned farmland | Yes, with limits | Only to a person resident in India who is an Indian citizen |
| Buy apartments, villas, commercial units, approved plots | Yes | No limit on number, no RBI approval needed |
| Buy farmland in a resident relative's name with your money | No | This is benami and also a FEMA contravention |
Where "farm plot" projects around Hyderabad fit
You will see "managed farmland", "weekend farmhouse plots" and "farm villas" marketed heavily to NRIs, especially along the Shankarpally, Chevella, Moinabad and Shadnagar belts. The marketing language does not change the legal nature of the land. What matters is how the land is classified in the revenue records, which you can check on the Bhu Bharati portal.
- If the land is still agricultural in the revenue records, an NRI or OCI cannot buy it, whatever the brochure calls it, and whatever the developer says about "fractional ownership" or "membership".
- If the land has been lawfully converted to non agricultural use through a NALA conversion order, and the layout is approved by HMDA or DTCP, it is generally treated as non agricultural property. Take a written legal opinion on the specific conversion order before paying anything.
- If the project sells a farmhouse, it falls squarely within the prohibited category.
Red flag: a seller who suggests registering the farm plot in a resident relative's name "just for the paperwork". That structure exposes both of you to FEMA penalties and to benami law, and leaves you with no enforceable ownership.
What happens if the rule is broken
Section 13 of FEMA provides for a penalty of up to three times the sum involved in a contravention, where that amount can be quantified, with further penalties for continuing contraventions. Beyond the penalty, a purchase made in breach of FEMA can leave the title open to challenge, which makes the land very hard to sell, mortgage or pass on cleanly.
If you inherit agricultural land in Telangana
Inheritance is fully permitted. The practical steps are to secure the succession documents, complete the succession or mutation through Bhu Bharati so that the revenue record shows your name, keep the land in use (lease or cultivation by family), and pay any local levies. Our ancestor property service helps heirs who do not yet have the full paper trail, and our guide to pattadhar passbooks and pahani explains the records you will receive.
When you sell, the buyer must be a resident Indian citizen. Sale proceeds go to your NRO account, and repatriation is generally possible within the USD 1 million per financial year facility, subject to tax and CA certification.
Legal alternatives if you want land near Hyderabad
- Approved residential plots in HMDA or DTCP sanctioned layouts, after checking the conversion history.
- Villas and gated community homes in peri urban areas, which give space without the farmland restriction.
- Purchase by a resident family member with their own funds, held in their own name for their own benefit, not as your nominee.
Whichever route you choose, run the standard checks: revenue classification, conversion order, layout approval, an Encumbrance Certificate, a prohibited land check, and an FTL and buffer zone check for anything near a lake.
Frequently asked questions
Can an OCI cardholder buy a farmhouse near Hyderabad?
No. Under Rule 24 of the FEMA (Non-debt Instruments) Rules, 2019, OCI cardholders and NRIs cannot purchase agricultural land, plantation property or farmhouses anywhere in India.
Can my father gift me agricultural land while I live abroad?
Not under the general permission. NRIs and OCIs may receive gifts of residential or commercial property from relatives, but agricultural land, plantation property and farmhouses are excluded. Inheritance after the owner's death is permitted.
Can I keep farmland I bought before moving abroad?
Yes. The restriction applies to acquisition by a non-resident. Land you bought lawfully while resident in India can be kept, leased and later sold to a resident Indian citizen.
If farm land is converted to non agricultural use, can an NRI buy it?
Land lawfully converted through a NALA conversion order, in an HMDA or DTCP approved layout, is generally treated as non agricultural property that NRIs may buy. Get a written legal opinion on the specific conversion and approvals first.
What is the penalty for an NRI who buys agricultural land?
Section 13 of FEMA allows a penalty of up to three times the sum involved where it can be quantified, and the title may also be open to challenge.
Official sources checked
- Official FAQ: Acquisition and Transfer of Immovable Property in India (MEA hosted)
- Reserve Bank of India: Master Directions
- India Code: Foreign Exchange Management Act, 1999
- Bhu Bharati portal, Government of Telangana
This guide is general information for property owners and is not legal, tax or financial advice. Rules change, and your facts matter. Confirm your specific situation with a Chartered Accountant or a Telangana advocate before acting.
Checking a farm plot or an inherited land parcel?
We verify the revenue classification, conversion order and layout approval, and tell you plainly whether an NRI can hold it.