LIVE GST Certification Course by CA Arun Chhajer begins 21st April. Register Now!!

Is forex trading legal in india?

fazeel (student) (24 Points)

08 October 2011

hello everybody, i am a doctor from AP. i came across this beautiful forum through search engine and thought this is the perfect place to clarify my doubt.

right now i am pursuing masters from india so i am a student at this moment without any stipend or salary. i learnt quite a few things about forex so i thought i can trade in online forex as a part time job. i also have a demo account with a broker and i have the confidence that i can earn some money through this. but my doubt is, i read on some forums that forex is illegal in india. i would like to clarify on this.

please let me know about the legal prospects of forex trading in india.

thanks.

Reply
Follow
Share

7 Replies

Gil Burt (admin) (38 Points)
Replied 02 November 2011

Thanks..... you all help me vey nicly.I agreed without proper knowledge its worst to go blindly into forex market.

https://www.otcmarketalerts.com/

MichealFlether214 (Student) (36 Points)
Replied 27 November 2011

Originally posted by : Kondal Reddy
	Originally posted by : fazeel hello everybody, i am a doctor from AP. i came across this beautiful forum through search engine and thought this is the perfect place to clarify my doubt. right now i am pursuing masters from india so i am a student at this moment without any stipend or salary. i learnt quite a few things about forex so i thought i can trade in online forex as a part time job. i also have a demo account with a broker and i have the confidence that i can earn some money through this. but my doubt is, i read on some forums that forex is illegal in india. i would like to clarify on this. please let me know about the legal prospects of forex trading in india. thanks. Hi fazeel, Did u check the response I gave earlier. have u tried using the platforms i suggested. I am reposting the message for your refrerenec. "Hello Fazeel, Forex trading is legal in India. Forex trading is not rocket science but at the same time its not a routine affair. Never invest money in a real trading account until you get fair bit of practice in a demo account. There are many trading platforms that allow users a demo account. You can try FxDialogue, Etoro etc ..I personally use FxDialouge. www.fxdialogue.com Let me know if u need any help.

What leverage do etoro provide? what makes you prefer FXDialogue over eToro? I have heard they have excellent customer service, is that correct?

FXPIPS (Trader) (21 Points)
Replied 21 December 2011

Regarding legality of Forex Trading in India. The RBI does not permit outword transfer of funds for any type of speculative trading including forex trading. RBI is very specific about it. There is no mention whether one is allowed to trade or not. In this case one can be a managing trader for NRI's and non Indians for which only commission is received as managing trader. Though there are restrictions funds are being transferred in the guise of investments abroad.

Marc (Student) (21 Points)
Replied 20 January 2012

Hi fazeel,

Actually, the RBI does clearly mention that residents of india are not permitted to trade forex. Having said this, I do see many people still trading and discussing this openly in web forums, etc. Here are the sources to learn more about what the RBI said about forex trading in india:

Article from India Times

Forex Trading in India Website

Hope that's helpful.

Manoj Koirala (student) (21 Points)
Replied 19 December 2012

Forex trading is legal for forex option and forex future only but not for intraday.

Reference:https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=23941

The Reserve Bank of India has today clarified that remittance in any form towards overseas foreign exchange trading through electronic/internet trading portals is not permitted under the Foreign Exchange Management Act (FEMA), 1999. The Reserve Bank has also clarified that the existing regulations under FEMA, 1999 do not permit residents to trade in foreign exchange in domestic / overseas markets.

Residents are, however, permitted to trade in currency futures and options contracts, traded on the stock exchanges recognised by the Securities and Exchange Board of India (SEBI) in India, subject to the conditions specified by the Reserve Bank from time to time.

Background

The Reserve Bank had noticed advertisements issued by electronic / internet portals offering trading or investing in foreign exchange with guaranteed high returns. Many companies even engage agents who personally contact gullible people to undertake forex trading/ investment schemes and entice them with promises of disproportionate / exorbitant returns.

The Reserve Bank of India cautions the public not to remit or deposit money for such unauthorised transactions. The advice has become necessary in the wake of many residents falling prey to such tempting offers and losing money heavily in the recent past.

Alpana Killawala
Chief General Manager

Press Release : 2010-2011/1196

Parth (Job) (22 Points)
Replied 21 November 2017

FreshForex have fast order execution and money withdrawal, the customer support are always responding properly to all my questions and concerns. I currently trade with this broker and have no problem at all.

Sireesha Gorti (Sole Proprietor) (174 Points)
Replied 23 May 2018

Hi everyone,

Can anybody suggest me whether Forex trading in currency pairs like EUR/USD etc. wherein INR is not involved is legal in India especially when the broker is not from India in current situations.

Also, please suggest whether CAs can do forex trading or not.