She can relinquish her right with registered relinquishment deed in the sisters favour.  She can also execute a registered will for the same. 

1.execute Relinquishment deed Or Gift deed. 

2.Transfer of immovable property is possible through POA if the same is a registered one. If the Principal is a foreign citizen/resident then she can execute POA from her country of residence and get it notarized and attested from local Notary and Consulate Officer. The same then is required to be Adjudicated from local Collector. Then on its basis the attorney can get or transfer immovable property. 
So in your case the POA can be executed in foreign in the above mentioned manner and then sent to India for further procedure. 

Sister staying abroad can execute specific  power  of attorney in favour of family member to execute gift deed 

2) POA should be attested before Indian consulate 

3) on basis of POA family member can execute gift deed in favour of second sister 

1. Sister 1 can give POA to anyone she chooses  preferably a near relative to represent her in the registration office.

.2 The said POA requires to be notarised in abroad and then on its sending to India by post is needed to be stamped/adjudicated and after that on this basis the attorney mentioned in the POA can represent or soon sister for making a gift deed in the name of sister 2. 

3. The gift deed is needed only f title deed bears name of both sister. Mere issuance of share certificate in the name of one does not require gift deed and a plain NOC will do the job.

Sister 1 can send a POA to transfer the flat to sister 2 and to register and execute a deed gift or relinquishment.

The PoA can be sent in name of sister 2 and using same sister 2 can make a registered deed.

A gift deed can be made in the foreign country duly notarized and signed by an oath commissioner. That would serve your purpose as the transfer is tax free.

Regards 

1) Ask sister_1 to give POA signed in the USA in front of Indian Embassy on sister_2 name. And in POA the format wording should be of quitclaim deed agreement.

2) Than sister_2 can transfer property here in India by submitting papers in registered office.

Sister 1 can  make a gift deed in favour of sister 2

There is no need for sister 1 to travel to India for same

A gift deed can be drafted through a lawyer which can then be mailed to sister 1

Sister 1 can take a print of that deed and then sign it before the Indian consulate

In addition sister 1 will also be mailed a power of attorney (from sister 2 to sister 1) wherein she will be authorised to complete registration formalities of the gift deed on behalf of sister 1

This power of attorney also needs to be signed before the Indian consulate or Indian embassy in the foreign country (whichever is nearby to sister 1 there)

The signed gift deed and POA can then be couriered to sister 2 in Mumbai 

Sister 2 will then have both the document stamped for the applicable stamp duty

There is nominal stamp duty of 3% I guess on the gift deed between sisters. Its 3% of market value of the share being transferred. So it will be 3% of market value of 50% share of sister 1

Sister can then sign the gift deed and present it for registration before the sub-registrar here using the POA from sister 1

The above method will transfer the property 100% to sister 2 in lifetime of sisters 

Another way is to make a Will in favour of sister 2 which for now will not incur any legal charges to sister 1 for the transfer, but later on her demise the Will has to be proved by filing a probate petition which is an expensive procedure

I would suggest option 1

The charges for gift deed procedure will be -

1. Lawyer's professional fees for drafting gift deed and power of attorney plus preparing society transfer forms

2. Stamp duty on gift deed, poa and transfer forms as applicable 

3. Registration agent fee 

4. Registration charges (presently its 1% of market value)

5. Out of pocket expenses on actuals

For that her presence is must or sister 2 can give power of attorney to any person, who will accept 100% on her behalf. Either execute gift deed or release deed. Will register at sub registrar office.

The sister residing at abroad may give a  POA deed in favor of any close relative in India so that the power agent can transfer her share in favor of the other joint owner by a registered deed. 

Having the name on the agreement of a Flat does not confer any title as per law.

Please state as to whose name is there on the sale deed, so as to enable to give a more concrete advise.

1. Was the sale deed executed and registered in favour of both the sisters?

2. If yes, then sister 2 is already the co-owner of the said flat.

3. Now for conveying the title of the share of sister 1 to sister 2, a gift deed in favour of sister 2 shall have to be registered by sister 1 and sister 2 shall have to append her signature on the said gift deed expressing that she has accepted the possession of the gifted share of the flat of sister 1.

4. Sister 1 can send the gift deed to sister 2 who can sign it before the appropriate officer of local Indian Counsulate for returning to sister 1 in India to enable her to get the said gift deed registered in India.

5. Alternatively, sister 1 can execute a will bequeathing her share of the flat in favour of sister 2 and in that case sister 2 will own that share  only after the demise of sister 1.

Dear client 

Here sister 1 can send GPA(General Power of Attorney) From USA in name of sister 2 and then sister 2 register the GPA here in India with sub registrar and on basis of that GPA she can make relinquishment deed to give away rights of sister 1 on the name of sister 2. Through which she will become the 100% owner that property.

Hii

Greetings of the day

The sister who wants to transfer all the right to other sister has to make only release deed of that particular property. And get it registered and hand over the documents to other sister is the easiest way of giving all the rights.

All the best

1. As per the information mentioned in the present query, makes it clear that clarification has been sought as to how to transfer the property on the name of sister while the one releasing her right does not want to come to India.
2. There can be an execution of the GOA or POA in the favour of someone other than the sister who is also a close relative to one in foreign country.
3. And then the GPA holder will execute the release deed in favour of the sister in India.
4. Rest, you are free to call me at any time for further detail discussion on this issue.