⭐ Is Forex Trading Legal in India?


Is Forex Trading Legal in India?

Is Forex Trading Legal in India? ⭐

Forex Trading is Allowed in India with Third-Party Brokers and You can also trade in Forex via SEBI Approved Brokers in the following Allowed Currency Pairs.

Securities and Exchange Board of India (SEBI)

The Securities and Exchange Board of India was established on April 12, 1992, by the provisions of the Securities and Exchange Board of India Act, 1992. SEBI provides the regulations for Trading Stocks, Derivatives, Futures, Commodities, and Currency Market.

As per the Circular of Date September 13, 2017, Circular Number SEBI/HO/MRD/DP/CIR/P/2017/102 there are following Currency Pairs are allowed for Trading in INDIA. This Circular increases the Number of Currency Pairs for Trading in Forex by adding Cross Currency Pairs other Than XXXINR.

List of Currency Pairs Allowed for Forex Trading in INDIA after 2017

I suggest you choose your favorite currency based on Spread and Volatility.

World Famous Currency Pair "EURUSD" is known for Lowest Spread and Highest Volatility. If you are new to Forex Trading. You can start with EURUSD trading.

Why SEBI and RBI Imposed Restriction on Forex Trading?

SEBI and Reserve Bank of India (RBI) imposed this restriction in Forex Trading for the prevention of Foreign Reserve and devaluation of Indian Currency "Rupee".
Because if you send money in the form of Dollars ($) and Lose this hardcore money in Trading due to a lack of knowledge and skills, it will reduce the Dollars kept in the Foreign Reserve.

What is the actual restriction in Forex Trading?

Forex traders cannot take part in trading any currency pair other than the above list. As you can see the above list of currency pairs have to base currency as INR and Some Cross Currency Pairs are EURUSD, GBPUSD, USDJPY.

Any Indian citizen is legally barred from sending INR out to foreign countries for the purpose of investments or trading.

Forex brokers can only offer conversion options for USD, JPY, GBP, and EUR after and before trading.

All SEBI-regulated forex brokers in India need to be registered.

Can I trade with International Forex Brokers?

Yes, You can Trade with Internation Forex Brokers. But the Government of India can not help you if you are trapped in some scam. You can not file any legal complaint against the broker in the following conditions if you faced it.
  • Brokers can demand you some extra money for giving withdrawal of your profit in your bank account.
  • Some Trade can be hit stop loss due to floating "Spread" which is instantly increased due to high volatility or session time.
  • The broker can manipulate the rate of conversion of USD into INR at the time of actual withdrawal. etc

What is the solution for the prevention of Fraud in Forex Trading?

Dear, Kindly Trade with only well-known regulated Forex Brokers either local or international, They generally don't practice the manipulation of price, conversion, etc.

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Enjoy !!! Forex Trading is legal in India. You can trade with any SEBI Regulated Broker or Any Reputed International Broker with allowed currency pairs. There is only a requirement of paying Income Tax on Earned Profit as per the Tax Slab in India. You can contact any Charted Accountant (CA) for applying Income Tax as Other Income Source from Foreign Business in case of Internation Brokers used.