Forex trading in India - Legal?. Here is RBI circular

[nasable]

hello all,

This is a year RBI has brought into many restriction to trade forex.. .. I understand Forex is risky to trade and so is BSE, NSE and so is any other instrument to trade ..

Why dont RBI think on dong something to regulate the forex trade instead of banning it completely banning.. guys have mercy

regards,
Shine

Completely agree with you, banning is not the solution. Instead regulation could have helped thousands of traders. RBI should reconsider this clause.

 

[sumeetsj]

Posting a link of a similar thread..

hope this helps

http://www.traderji.com/forex/49792-remittance-profits-trading.html

 

[kamara]

Hi profit.biz, i am new to forex, how to deposit and withdrwal money for forex trading.

 

[hunt3r]

Hello,

I am new to this forum and I have a question regarding this RBI circular.

I have read the circular for Liberalised Remittance Scheme and the clause as below:

Q. 30. What are the prohibited items under the Scheme?

Ans. The remittance facility under the Scheme is not available for the following:

i) Remittance for any purpose specifically prohibited under Schedule-I (like purchase of lottery tickets/sweep stakes, proscribed magazines, etc.) or any item restricted under Schedule II of Foreign Exchange Management (Current Account Transactions) Rules, 2000;

ii) Remittance from India for margins or margin calls to overseas exchanges / overseas counterparty;

iii) Remittances for purchase of FCCBs issued by Indian companies in the overseas secondary market;

iv) Remittance for trading in foreign exchange abroad;

v) Remittance by a resident individual for setting up a company abroad;

vi) Remittances directly or indirectly to Bhutan, Nepal, Mauritius and Pakistan;

vii) Remittances directly or indirectly to countries identified by the Financial Action Task Force (FATF) as non co-operative countries and territories, from time to time; and

viii) Remittances directly or indirectly to those individuals and entities identified as posing significant risk of committing acts of terrorism as advised separately by the Reserve Bank to the banks.


Now,
My opinion is we can not send money outside India for trading in those foreign exchanges but IF we can arrange funds from abroad then we can do it.

I mean, eg. I open a trading account in some xyz foreign exchange company outsite India. And I have a friend (Non-Indian) in USA who fund my trading account with his OWN money.

I trade and withdraw money per month to India through wiretransfer/alertpay/ or any similar way which that trading site allows.

In this example, I am not sending any money from India for trading purpose as per RBI circular.

Friends, need your opinion for this way to trade and earn and receive money (without sending).

Thanks,

 

[TraderDude]

Here we go again....

There are plenty of regulated brokers outside india who will glady take your money.

You don't need to trade in a foreign exchange and send money to your friends in other countries.

Open a mini account in any of the reputed forex brokers like onanda,Alpari..etc. send money via credit card/ money bookers/ LR. and start Trading.

There are a million people trading forex in mini accounts in so many brokers. Just browse our own TJ forex section. Many will help you setup a account and start trading.

Get this through your head people. I do not want to see another post about RBI regulating forex trading in india.

yea and don't worry about taxes and all, because you will need a lot of time to make money in forex and even come close to paying taxes.

i still have meet a indian forex trader who is paying taxes from his forex trading..:rofl:

Good luck to all.

 

[prakash2010]

Individuals cannot trade in forex market: RBI


PTI Feb 21, 2011, 10.14pm ISTTags:Reserve Bank|forex market
MUMBAI: The Reserve Bank today said resident Indians cannot trade in forex market as per the existing regulation.

The existing regulations under Foreign Exchange Management Act (FEMA), 1999, do not permit residents to trade in foreign exchange in domestic or overseas markets, RBI said in a statement.

The clarification of the RBI assumes significance in the light of several people losing heavily in forge trade through internet portals in the recent past.


It also said, remittance in any form towards overseas foreign exchange trading through electronic/internet trading portals is not permitted under the FEMA.

RBI cautioned investors against advertisements issued by certain electronic and 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 and investment schemes and entice them with promises of disproportionate or exorbitant returns, it said.

 

[prakash2010]

Lot of oppurtunities available in nse ,bse ,mcdex, ncdex exchanges.

Why you people fall in prey to forex.

 

[TraderDude]

Individuals cannot trade in forex market: RBI


PTI Feb 21, 2011, 10.14pm ISTTags:Reserve Bank|forex market
MUMBAI: The Reserve Bank today said resident Indians cannot trade in forex market as per the existing regulation.

The existing regulations under Foreign Exchange Management Act (FEMA), 1999, do not permit residents to trade in foreign exchange in domestic or overseas markets, RBI said in a statement.

The clarification of the RBI assumes significance in the light of several people losing heavily in forge trade through internet portals in the recent past.


It also said, remittance in any form towards overseas foreign exchange trading through electronic/internet trading portals is not permitted under the FEMA.

RBI cautioned investors against advertisements issued by certain electronic and 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 and investment schemes and entice them with promises of disproportionate or exorbitant returns, it said.

Again, you have been misinformed , who is giving you this information.

If RBI say that about Forex, then they must not allow Stock trading also. But many people fall prey to indian stock market. RBI should caution against that and ban stock trading..

And any trader who is willing to risk money in any kind of trading know forex trading is no different than stock trading.

Infact i will say this forex trading is less risky than stock trading. Why? because in forex
1. More liquidity than stocks
2. Traded 24/7

Sooner or later the indian public will want a piece of forex trading and RBI/SEC will regulate it. It's just a matter of time.

 

[SavantGarde]

TD is absolutely right...on all counts....If I have a Foreign Currency Denominated Account.... Here in India as allowed by RBI to Individuals... and that money is either as consultancy or as gift and remains in the original currency.....which doesn't affect Forex Reserves of India.....& What I do with that currency in my account is no business of anybody to dictate terms....so who is going to stop me from Trading outside India with that money.

People should understand.... this thing of 'Illegal' & 'FEMA' are just things to put fear and push Currency Traders into the arms of Indian Brokers who charge arm and a leg...as brokerage....

Interpret the Policy guidelines from a lawyers point of view and you shall have a way of doing this Legally....

Positively ...this will be the last Post.... on this issue...

SG

Again, you have been misinformed , who is giving you this information.

If RBI say that about Forex, then they must not allow Stock trading also. But many people fall prey to indian stock market. RBI should caution against that and ban stock trading..

And any trader who is willing to risk money in any kind of trading know forex trading is no different than stock trading.

Infact i will say this forex trading is less risky than stock trading. Why? because in forex
1. More liquidity than stocks
2. Traded 24/7

Sooner or later the indian public will want a piece of forex trading and RBI/SEC will regulate it. It's just a matter of time.

 

[prakash2010]

Why you people are deciding forex trading is legal for individual residants.

Rbi is the deciding authority. The primary question is forex trading is illegal or not . Why you people going into the merits of rbi decission.

Here is the rbi decission.


Individuals cannot trade in forex market: RBI


PTI Feb 21, 2011, 10.14pm ISTTags:Reserve Bank|forex market
MUMBAI: The Reserve Bank today said resident Indians cannot trade in forex market as per the existing regulation.

The existing regulations under Foreign Exchange Management Act (FEMA), 1999, do not permit residents to trade in foreign exchange in domestic or overseas markets, RBI said in a statement.

The clarification of the RBI assumes significance in the light of several people losing heavily in forge trade through internet portals in the recent past.


It also said, remittance in any form towards overseas foreign exchange trading through electronic/internet trading portals is not permitted under the FEMA.

RBI cautioned investors against advertisements issued by certain electronic and 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 and investment schemes and entice them with promises of disproportionate or exorbitant returns, it said.


You will be punished,if you get caught,according to fema and money laundering act.



I repeat, iam not going into the merits of the decission.