Is Forex Trading in India legal from Alpari india ?

[sanjay_arora]

Just i want to tell Alpari that REMITTANCE OF INDIAN RUPEE FOR FOREX TRADING IS ILLEGAL IN INDIA BUT RECEIVING OF INCOME IS NOT BANNED

Nowhere does Indian law talk specifically about forex trading.

Subject head is "Investment Abroad" and its wide enough to cover property, bodns, deposits, equity, mutual fund, commodity, forex & so on.

Remittance is not banned...you can take LRS form and remit abroad.

But the question for the trader is, are you willing to trade without leverage? If not, no other route left but apply to RBI.

Law does not allow this or disallow that. There is a general exemption list, there's another exemption list where powers have been delegated to the Exchange Dealer (your bank in this case), there's another banned list....rest everything else comes with specific permission.

You say you want to stand up on top of Effiel Tower and shower the french with US currency notes....since there is no general exemption and no listing on banned list....you apply to RBI for specific permission

 

[mercyman007]

Despite all I have said, nothing says RBI will not allow leverage. The law simply says, you cannot do so.

If you have any remittance requirements that do not meet the general exemptions, RBI will give you specific permission. It is not general permission. It is specific to you. Its on your application, documentation etc.

Now the questions RBI has are:

- Do you have professional credentials in the sector (trading) in India?
- Or do you have experience and the documentation to prove it?
- Do you have the funds?
- Are the funds your own? Borrowed funds...brother/sister etc. are not admissible. Its your personal balance sheet which is in question.
- Are you asking for a huge amount? Is it full year's LRS quota equivalent?
- What is the leverage being allowed to you?
- What is the maximum sum of amount you can lose and after deducting the remittance, what is the liability that will have to be met?
- The potential liability, is it within LRS quota?
- What is your financial status to withstand the liability without bankruptcy & having a normal life?
- If the remittance is allowed, is the amount enough to justify cost of submitting quarterly or annual returns to RBI through your banker and are you willing to do so?

Subject to outcomes of such questions being positive and your willing to do a little paperwork, there is no reason RBI would not allow you your just profession.

On the other hand if your are just tired of betting on Indian Cricket and want to try your hand at the Japanese Yen or the auto-earning robot from Mars, the RBI remains committed to protect you from yourself

They are not bad people, guys. Just doing a job no one else wants

Thanks Sanjay Sir!

I have one query..
Suppose if I earned profit $500 from my initial $200 deposited via LRS. It means I brought $300 USD for India. Then its good if anyone earned from forex as it gives us foreign currency. My question is Whether RBI will punish me for this coz i remitted $200 USD previously?

Another question .. What will be the possible punishment if I remits $200 USD to open live micro account with Alpari or other broker?

Forgive me for my such silly questions. I am not genius but forex can be good source of additional income to me.

Big Thanks!
Dr. Dev

 

[sanjay_arora]

Thanks Sanjay Sir!

I have one query..
Suppose if I earned profit $500 from my initial $200 deposited via LRS. It means I brought $300 USD for India. Then its good if anyone earned from forex as it gives us foreign currency. My question is Whether RBI will punish me for this coz i remitted $200 USD previously?

Another question .. What will be the possible punishment if I remits $200 USD to open live micro account with Alpari or other broker?

Forgive me for my such silly questions. I am not genius but forex can be good source of additional income to me.

Big Thanks!
Dr. Dev

If you have any Income from trading, it better be declared under the Income Tax Act. Resident Indians worldwide Income is subject to Tax. Divert it for whatever purpose.....but pay tax on it. Investment is allowed, just don't expect the taxman not to ask what were the results of that investment.

As a Resident Indian, your worldwide Income is taxable in India...ask your CA.

RBI is not bothered, if you never bring your money back to India, until its revoked under LRS, by specific law. If you lose that money in trading or bad investment...that too does not put you in a fix....LRS investments are reported to the banker on some periodicity...you need to give your account statements to your banker and he may ask for further documentation. Once your loss is accepted through proper documentation, you have no further liability. If the banker is doubtful of any hanky-panky on your part, he can forward to RBI.

Fine is specified as three times the offence...it does not state, what would be counted as offence...the capital that was wrongfully routed or the amount of transaction that was done with it

As I said you can open an investment account with anyone, you may changeover your investments on any periodicity required...this is called trading

Interactive Brokers is opening accounts for Indians abroad. They are not allowing Leverage. Go through a legit outfit. I have an account with them. asked about foreign account...they said yes, but without a single cent of leverage and account will be officially opened by their subsidiary here...they will be equally liable...that's why they are very strict about leverage.

Lot of Indians are using LRS without bothering about the law...this is being done in case of property in Dubai being bought on EMI and leveraged trading.

If the DRI (Directorate of Revenue Intelligence) catches up with them, there will be hell to pay....luckily for the offenders the days of the FERA are over...but India now has a money laundering law, that can be appropriately or inappropriately applied!!

Basic question remains the same....can forex be traded without leverage? If yes, you don't need specific permission!!

 

[shobhitdalmia]

please dont get confused by asking silly question .do trading otherwise stop asking funny questions on that . there is nothing which shows illegal or legal .do the trade show all this on your itr enjoy .pehle kama to lo jab hi to kuch dhikahoge income tax ko .some of them taking about $200 or $300 .this is very very little amount .trade with more and earn good if you know how to earn.

 

[arjunwhabi]

If Alpari India or for that matter any forex broker allows you to launch a trading robot and has the facility to provide you a private server which can operate your trade nonstop 24*5,things become easy as you dont have to keep your pc switched on.I am on the lookout for such a setup and if it materialises,it is all that is needed. rbi regulation do not stop you from that.

HI everyone. and mr Vakratunda pls put in your input

I wAS just going through this forum as well because I was starting to trade forex myself and wanted to know if its legal or not. I came across this Forex trading company based in New jersey, who are now just starting in India - Forex Chex www.forexchex.com

They are offering multiple forex education as well as forex trading robots and manual trading systems. ( Mr vakratunda i went through your post as well and this forex trading robot might be exactly what you need). Im thinking of signing up with the ATS prodcut they offer- the automated trading system. its basically an automated trading software installed on a virtual server abroad which trades your account. So i basically have to open an account with Forexchex who in turn will tie me up with their partner brokerage - Alpari - london office. They recommended the london office over usa because now in usa the leverage has been reduced.

They claim their ATS product generatess approx 10 - 15% return per month if you are willing to acacept upto 10 % drawdown on your account. WHat do you guys think ? will this be legal?
I will be opening an account with Forexchex ( basically investing with them ) , who in turn will be opening an account for me at the brokerage and all my trading is done from a virtual private server ( no trading done in india) ( however the trading will be leverage trading) so will this be legal for me as a resident indian ? mr vaktratunda you said such trading of forex is legal as RBI permisses it. How so ?

 

[jessica_30]

The links provided are very informative. To those who shared it. Thank for the ideas and information. Newbie like me learn a lot from those links. Thank you.

 

[wetradefx]

hi, i am writing a report for a leading financial markets portal, the article is about fx trading in india, its history its challenges

please send me information, i can also include you in an interview form

 

[shreekar999]

can anyone suggest trading forex-commodity-nifty stocks with mt4 platform in india

 

[shmore2000]

But Also see the Guideline on the same page Question No. 30:
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.

 

[Tradr103]

Hi Raj,are doing trading with alphari???? what's your experience??