How NRIs Can Invest in Indian Solar Projects from the US
By Hardik BhatiaPublishedIf you are a Non-Resident Indian living in the United States, you have probably explored the usual menu of Indian investment options - NRE fixed deposits, mutual funds through PIS accounts, Indian equities, maybe even real estate. Each one comes with its own layer of regulatory friction: FEMA compliance, NRE vs NRO routing, SEBI rules, TDS deductions, and repatriation limits.
What most NRIs do not realize is that there is a route into one of India's fastest-growing sectors - solar energy infrastructure - that bypasses almost all of that complexity. It works through a US-registered investment entity, is regulated by the SEC rather than SEBI, and pays monthly returns in USD. No NRE account needed. No PIS registration. No FEMA routing.
This guide explains how NRIs in the US can invest in Indian solar projects through fractional ownership, why the structure is fundamentally different from traditional NRI investment routes, and what to evaluate before committing capital.
Why Are NRIs Uniquely Positioned for Indian Solar Investing?
NRIs in the US sit at the intersection of two advantages that almost no other investor group has: financial sophistication in one of the world's deepest capital markets, and cultural familiarity with one of the world's fastest-growing energy markets.
The financial side is significant. NRIs working in the US who are likely to meet accredited investor thresholds ($200,000 individual income or $1 million net worth excluding primary residence). They understand SEC-regulated private offerings, they are comfortable evaluating IRR projections, and they have the financial literacy to assess a Private Placement Memorandum. This is not a trivial advantage. Most of the world's retail investors are not accredited and cannot access the private market offerings that often deliver the highest risk-adjusted returns.
The India side matters just as much. NRIs track India's economic trajectory more closely than almost any foreign investor group. They read Indian business news, they understand state-level differences in policy and regulation, they know what a DISCOM is and why it matters. When you tell a US institutional investor that a solar project in Rajasthan has a 22% CUF (Capacity Utilization Factor) and a 25-year PPA with a C&I buyer, it takes twenty minutes of explanation. When you tell an NRI the same thing, they get it immediately.
This dual fluency is why NRIs are emerging as a natural investor base for Indian solar. India received $135.4 billion in remittances in FY25 (a record) with the US contributing roughly 28% of total inflows. The financial corridor between the US and India is the largest bilateral remittance channel in the world. NRI solar investing is, in a sense, a more sophisticated version of the same capital flow - money moving from the US to India, but into income-producing infrastructure rather than savings accounts or real estate.
India's solar sector is scaling at a pace that validates the investment thesis. According to JMK Research estimates, the country added 44.6 GW of solar capacity in FY2026, overtaking the United States as the world's second-largest solar market and targeting 500 GW of non-fossil fuel capacity by 2030. For NRIs who already believe in India's growth story, solar offers a way to participate in that growth with contracted, predictable returns rather than the volatility of Indian equities.
How Is NRI Solar Investing Different from Traditional NRI Investment Routes?
This is the most important section of this guide, because the structural difference changes everything about the investor experience.
When an NRI invests in Indian equities, mutual funds, or real estate, the capital flows into India. The NRI opens an NRE or NRO account with an Indian bank, routes funds through the Portfolio Investment Scheme (regulated by SEBI and RBI), and navigates FEMA regulations governing foreign exchange. Returns are earned in Indian Rupees. Repatriation of principal and gains is subject to limits ($1 million per financial year from NRO accounts), requires Form 15CA/15CB certification from a Chartered Accountant, and involves TDS deductions that must be claimed back through Indian income tax filings.
This process works, but it is bureaucratically heavy. Ask any NRI who has tried to repatriate rental income from an Indian property, and you will hear a story involving at least three institutions, two forms, and several weeks.
Fractional solar investing through a US-registered platform works differently - and the difference is structural, not cosmetic.
When you invest through a platform like Sustvest, you are purchasing membership units in a Delaware-registered LLC. Your capital goes into a US entity. The LLC, in turn, owns 100% of an Indian Special Purpose Vehicle (SPV) that owns the solar project. The offering is structured under SEC Regulation D, Rule 506(c) — a US securities exemption. Your accredited investor status is verified under SEC rules, not SEBI rules. And your monthly distributions arrive in USD, directly from the US entity.
What this means in practical terms:
No NRE/NRO routing required for the investment subscription itself — you invest from your US bank account into a US LLC
No PIS registration — this is not a portfolio investment in Indian securities
No direct FEMA compliance at the individual level — cross-border capital movement happens at the entity level (LLC to SPV), not at the individual investor level
Distributions paid in USD — though underlying project revenues originate in INR, investors generally do not need to manage personal repatriation procedures, Form 15CA/15CB, or the $1 million annual NRO cap
Structured under SEC Regulation D and subject to US securities law disclosure requirements — Form D filed with the SEC, PPM governed by US securities law, verifiable on EDGAR. Note: SEC filing does not constitute approval, endorsement, or substantive review of the offering
For NRIs who have spent years navigating the regulatory friction of investing in India, this structure is a fundamental simplification. You are not investing in India as an NRI. You are investing in a US entity - as a US accredited investor - that happens to own Indian solar assets.
What Returns Can NRIs Expect from Indian Solar Investments?
Fractional solar investments targeting US accredited investors (including NRIs) typically offer an expected XIRR of 10–14%, with monthly cash distributions in USD. The minimum investment on platforms like Sustvest starts at $500 per project.
These returns are driven by the spread between the PPA tariff (the price at which the solar project sells electricity) and the cost of generation plus operations. Indian commercial and industrial electricity buyers pay grid tariffs that are significantly higher than solar generation costs, creating a margin that funds investor distributions. The wider the spread, the more room for returns.
To put these numbers in context, here is how fractional solar compares with the investment options NRIs typically consider:
NRE Fixed Deposits
Returns: 6–7% per annum
Income frequency: Quarterly or at maturity
Liquidity: Moderate (premature withdrawal with penalty)
Currency: INR (but fully repatriable with tax-free interest in India)
Indian Equity Mutual Funds (via PIS)
Returns: 10–15% historical long-term average (highly variable year to year)
Income frequency: Irregular (capital gains on redemption)
Liquidity: High (T+3 settlement)
Currency: INR (repatriation via NRE route)
Indian Real Estate
Returns: 3–5% rental yield + appreciation (location-dependent, historical)
Income frequency: Monthly rent (when occupied)
Liquidity: Very low (months to sell)
Currency: INR (repatriation requires CA certification, capped at $1M/year from NRO)
Fractional Solar (via US LLC)
Returns: 10–14% target XIRR (projected, not guaranteed)
Income frequency: Monthly distributions paid in USD (underlying revenue in INR)
Liquidity: Low (locked for PPA duration)
Currency: USD distributions (subject to INR/USD conversion at the entity level)
The comparison reveals a clear pattern. NRE FDs are safe but low-yielding. Indian equities are high-return but volatile and correlated with market sentiment. Real estate offers tangible ownership but comes with illiquidity, tenant risk, and repatriation friction. Fractional solar is among the higher-yielding infrastructure-style private investment options available to accredited investors, with monthly frequency and minimal repatriation complexity - but requires accepting a long lock-in period.
For NRIs specifically, the USD-denominated distribution is a meaningful practical advantage. Most NRIs earn in dollars and manage their primary financial lives in the US. An investment that delivers monthly distributions in USD - without requiring the investor to personally manage currency conversion or repatriation paperwork - fits more naturally into their cash flow than an Indian investment paying in rupees. It is worth noting, however, that the underlying revenue is generated in INR, and the INR-to-USD conversion occurs at the entity level. Currency risk is not eliminated - it is handled upstream rather than by the investor directly.
What Risks Should NRIs Be Aware Of?
NRIs face the same fundamental risks as any fractional solar investor — illiquidity, currency exposure, PPA counterparty risk, project underperformance, and regulatory changes. These are covered in detail in our dedicated guide: Solar Investment Risks: What Every Accredited Investor Should Know.
Frequently Asked Questions
Do NRIs need an NRE or NRO account to invest in fractional solar? No. Because the investment is made into a US-registered Delaware LLC under SEC Regulation D, funds are typically transferred from your US bank account to the US entity. No direct NRE/NRO routing is required for the investment subscription itself. This is one of the key structural differences from traditional NRI investment routes — the capital flow at the investor level is US to US, not US to India.
How is this different from buying shares of an Indian solar company? Buying shares of Adani Green or Tata Power on the NSE gives you equity exposure to a company whose stock price is driven by market sentiment, earnings expectations, and sector rotation. Fractional solar ownership gives you direct participation in a specific solar project, with returns tied to actual electricity sales under a contracted PPA. The return drivers are fundamentally different — one is a stock, the other is infrastructure.
About Sustvest
SustVest LLC is a Delaware-registered fractional solar investment platform offering SEC Regulation D 506(c) compliant investment opportunities in Indian solar energy projects. Through its US entity structure, Sustvest enables accredited investors and NRIs to own membership interests (units) in operating solar projects backed by long-term Power Purchase Agreements. Each project is held in a separate Indian SPV, with SustVest LLC owning 100% of each SPV. Investors receive proportional monthly cash distributions in USD, with a minimum investment of $500 and target returns of 10–14% XIRR. Project details, SEC filings, and real-time generation data are available at sustvest.com.
This content is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities. Investments in private offerings under SEC Regulation D are speculative, illiquid, and involve a high degree of risk, including the potential loss of the entire investment. Fractional solar investments are available only to verified accredited investors as defined under SEC Rule 501(a). Past performance is not indicative of future results. Prospective investors should carefully review the Private Placement Memorandum (PPM) and consult with their own legal, tax, and financial advisors before making any investment decision. SustVest LLC does not provide investment, legal, or tax advice.
Sources:
Reserve Bank of India — India received $135.4 billion in remittances in FY25, a record (RBI Annual Data, July 2025)
SBI Research — India projected to receive $137–140 billion in remittances in FY26 (April 10, 2026)
PIB / Economic Survey 2025-26 — US contributes 27.7% of total remittance inflows to India; advanced economies now account for over half
IBEF — Indian diaspora exceeds 35 million across 200 countries; approximately 5.41 million people of Indian origin in the United States
Telangana Today / World Bank — 18.5 million Indians working overseas (2024 data)
JMK Research — India added 44.6 GW solar in FY2026, reaching 150 GW cumulative (April 10, 2026)
NSEFI — India set to become world's second-largest solar market in 2026 (April 12, 2026)
SEC.gov — Rule 501(a) accredited investor definition; Rule 506(c) of Regulation D
FEMA (Foreign Exchange Management Act, 1999) — NRI investment regulations and repatriation framework
IRS — FATCA (Foreign Account Tax Compliance Act) reporting requirements for US tax residents