Forex trading is illegal in India?

Hi Frnds,

I am a newcomer to forex and started with demo acc now, the important thing is I am from India...

As I heard that, Forex trading is illegal in India and I am totally afraid due to the statement. My doubt is trading with Indian currency is illegal or any currency trading is illegal from india ????

I am expecting ans from known people, especially Indian who is in forex trading currently...

Thanks,
Adhavan

I do not live in India, so I cannot say for sure... but I have never heard of such a thing.

Best to check with the proper authorities, or do not trade Ruppees, or open a foreign brokerage account.

Disclaimer: I am not an Indian national, but I suspect the Indian situation is similar to ours in Malaysia.

Find out if your rupee is legally trade-able offshore. If am not mistaken, it is not.

(and by "trade-able", I mean "legally speculated against in offshore markets". Money-changer or bureau de change activity is not counted.)

I would think that only trading against the rupee is illegal in your country, in which case, you need to find out if you may...
1. ... legally convert your rupee to a foreign currency asset.
2. ... legally wire/transfer your new asset to an overseas party.
3. ... legally park your new asset overseas and then repatriate it back home as and when you please.

If the answers to the above (in the same order) are all "yes", I suspect you are able to trade forex, as long as you don't speculate against your own home currency.

The above is just my opinion as someone familiar with capital control rules in my own region, which is South East Asia and the Far East in general.

You would need to check your RBI's website for more information on your country's exchange control rules and laws.

Good luck!

No it is not illegal in india..only u cant trade indian local currency

It's never been clarified but there is a possibility that a bank will freeze your account if you withdraw money from a brokerage "http://archive.indianexpress.com/new...ternet/774148/
Good luck and be smarter than the government.

thanks yes it seems it is illegal..I'l checked all articles...seems Indians can only trade with limited 4 currencies with INR.

Yes... bt the message which they were trying to convey the people is, not clear...

Still doubtful..

Adhavan

Please read below article...it will surly give you clarity... He has mentioned all claims by these forex companies...how they fool people by giving wrong information. Since they operate from outside india they can escape easily.

http://www.basunivesh.com/2013/12/26...-legal-or-not/

its illegal to trade forex in india . the other way to trade fx from india is through a friend a relative or friend living in a foreign country where fx is legal but considering you are pro trader and you have invested more than 5 lacs and after trading for a year or tow you turn it to 10 lacs or more how will you get the money cash gifts from relatives or friends is also limited . now considering the second option which is forming a company in singapore or dubai or any other place where fx is completely legal but again the main issue is transfer of money under liberalized scheme the money can be transferred but if the money is transferred only for the purpose of forex trading i doubt the govt will allow that .
the third option is to become a fund manager and provide a service of fund management to friends/relatives/investors or provide signals and earn commission ...... i guess this is the only way we can be actively involved in fx market and make a living out of it without doing anything which is illegal in india .

You can trade Forex in India legally, just do not do direct transactions with your Indian Banks debitcard, creditcard and bank-wires in or out with a off-shore broker.
Use a payment processor like paypal, neteller, moneybookers etc and use that as a middle man to deposit and withdraw to your bank and you should be fine.

If you make small amounts less than $100k a year, you can file your income tax at the end of financial year March under any fake reason like cross-border sales or consulting. For greater than $200k a year and over, just pay your tax on spot as advance tax.

Basically the government doesn't care as well as cannot monitor what everyone does on the internet, they just care if your paying your taxes or not.
Consult a Charted Accountant in India to help you.

Note though, do not mention anywhere that your trading or even tell the CA your trading, that works for me. Tell him your a International sales guy or a Business consultant or a software freelancer.

If you plan though to evade tax then your going to be in trouble, Just pay your tax somehow and you should be fine doing anything on the internet.

I am totally clear now, thanks friends for your post... espicially converstion which was shared by deepsrana was very nice..

Thanks friends once again.

Adhav

Adhavan,

Are you still doing Forex?

There is a rumour that forex trading will soon get legal in India through GIFT but i guess we will only be getting to trade Inr pairs against all currencies . there won't be pairs like EUR/USD now the government should allow forex trading in india because these days there are many who are trading Fx full time the government should allow the forex trader to pay taxes enough of tax evading by fx traders .

use well-known payment systems in $ and (as already said above) start with small amounts. Also ask from you broker about some kind of restrictions

RBI's statement says gambling with currency trading is illegal in india and they are not allowed banks send big amount of money to foreign country but i think people are using many e-currencies created by using their foreign address and sending their money via NRI account.

Here is China,forex trading is neither illegal nor legal,no policy made it clear on this point.Anyway,we just be cautious and will not spend a lot of money in trading.

if you're not jackanapes it's not a problem. i'm indian guy, i never had problems with trading in india and now in america both.

hi
ITS ILLEGAL trading forex online

who knows better that me!!
as I summonnned by DIRECTORATE OF ENFORCEMENT , with all documents, bank statements, credit card statements, foreign tour records, itrs and what not
i was there for 7 hours answering questions,,, i just traded at i forex 1900 dollors in 5 years(lost all and my ac was zero)

After 4 months i got show cause notice,
now i have to find fema consultant and give reply with heavy fine...

so please take rbi permission before subscribing online forex sites
regards

i hope this news will bring smile to all currency traders who have quit trading forex just because its illegal in india and many who are still trading in forex with offshore brokers because RESERVE BANK OF INDIA allowed EURUSD , GBPUSD , USDJPY in indian exchange .
https://www.rbi.org.in/Scripts/BS_Pr...spx?prid=35689

Did you transfer the money thru Bank wire transfer? Have you cleared the problem now?