Many of these Indians would've gladly retained their Indian passports given the opportunity, but India doesn't recognize dual citizenship officially. An exception is made for minors who acquire foreign citizenship involuntarily. At the age of 18, if they wish to take up Indian citizenship, it is granted immediately if they give up their foreign citizenship.

What we do have are People of Indian Origin (PIO) status for people with foreign passports and Indian ancestry living in India, and Overseas Citizen of India (OCI) status for others who live in India for extended periods of time while on foreign passports (I could be wrong about the details). In addition, citizens of Pakistan and Bangladesh aren't allowed to obtain PIO and OCI status.

PIO status people have to register with the police if they are planning on staying in India for over 180 days at a stretch. This rule does not apply to OCI. Neither category is allowed to vote, buy agricultural property, serve in defense forces or stand for public office.

However, some politicians like Manohar Parrikar (CM of Goa) have come out in support of dual citizenship in the recent past. Portugal recognizes people born in Goa during Portuguese rule as its citizens if they only register their births with the Portuguese government. They have no problem granting dual citizenship to Indians but India requires these citizens to give up their passport on taking up Portuguese citizenship.

On surfacing allegations that many government officials, police and lawyers in Goa have registered their birth with Portuguese government (and are hence eligible for Portuguese passports), Manohar Parrikar issued a statement "Technically, even I was born a Portuguese citizen as my birth took place under Portuguese rule in Goa. All our forefathers were Portuguese citizens and based on the fact that our ancestors were born during Portuguese rule we can apply for Portuguese citizenship. There is no issue at all." [1]

Indian citizenship is automatically terminated on taking up another citizenship. However, it is the responsibility of the individual to contact the Indian embassy and give up his passport, so there is a possibility that some people have held on to their Indian passports after taking up foreign citizenship if the country granting citizenship does not require any acknowledgement from the previous country of citizenship.

Given the current climate in India and the global economy, it stands to benefit to great extents if it amends its existing laws on acquisition of nationality. There are thousands of NRIs who have not taken up foreign citizenship in order to hold on to their Indian passport (or are not allowed to obtain citizenship in some other countries), and millions who were left with no choice but to give up their Indian passport when they became citizens by naturalization in other countries. India has lost a huge amount of investment into the local economy by rich and powerful individuals who could've possibly taken advantage of the situation and helped themselves as well as the country.

I admit the situation in India is volatile and it rightfully will not grant dual citizenship with just about every country that also recognizes dual citizenship with it, but it can start granting it on a country-by-country basis. Obviously given the climate, Pakistan-India, China-India, and Bangladesh-India dual citizenship will not be possible. Some others like those in the Arab peninsula have had good relations with India since independence (barring the Kashmir issue where they consistently support Pakistan for religious reasons). I'm not qualified to answer whether or not dual citizenship with these countries is a good idea, but even if it was, most of these countries don't recognize it themselves so it is not an option. However, international relations with UK, USA, Russia, Canada, France, Israel, Portugal, The Netherlands, Australia, Brazil and many others are favorable and likely to improve even further in coming years. All of these countries do recognize dual citizenship with other countries, and will not have much of a problem doing with India. Given the political clout and economic power of these countries, it will definitely help to have some members who share loyalties between them and India.

In addition, many of these countries allow dual citizens to even stand for the highest office. Arnold Schwarzenegger served as governor of California while holding Austrian as well as US citizenship. Other politicians in the USA and UK have served in office while simultaneously holding citizenship of other European and North American countries. India does not have to change its current rule regarding public office if it feels it's against national interest, but it can give dual citizens equal rights minus public office privilege.

The current Indian stance on citizenship comes from the pre-independence and WWII era when the self-interest of countries was largely removed from each others'. It was impossible to imagine U.K.-Germany or France-Germany dual citizenship back then. However, it is fairly common now as they've recognized we're in a global economy and co-operation is better than discord if you wish to become an economic and political superpower.

The OCI and PIO status are fairly recent developments (post-1991), once the government recognized the benefits of opening its gates to the influx of foreigners as well as out-flux of citizens. If there's a strong enough political force which presses for recognizing dual citizenship, it may happen in the future, but for now, it doesn't look likely but with all your support we can do it.

source: Quora Digest.