NEW DELHI : Currency Futures in India has already attracted international attention thanks to India’s position as one of the emerging economies in the world.

 

But it must keep its head high and made sure that its not carried away by the initial success and at the same time need to adapt some immediate changes, analysts said.

Currency Futures need to change some restrictions it imposed such as cut off limit of $ 5 million, ban on NRI’s, FII’s and mutual funds from participating.

 

Off late, Indian financial markets have caught the attention of large populace of NRIs (Non Resident Indians) and international business media. Government of India has initiated some excellent steps in the direction of fiscal reforms.

Introduction of Exchange-Traded Currency Futures in India is considered as the most vital step in the modernization of financial markets. SEBI and RBI  are two major regulatory authorities behind the legal framework of currency futures trading in India.

SEBI said, the markets would mature in due course and then after the government would consider introducing more number of currency pairs and innovative financial products.

Government is also contemplating to permit Foreign Institutions and NRIs to participate in currency futures in India. Economists strongly believe that future for currency market in India is bright.

Most of the forex participants also consent that expected growth in currency futures in India would be tremendous if the government continues with the essential reforms in currency markets.

For any person or NRI who is affected by currency fluctuations, it is essential to understand what better cash forex or currency futures are. Currency future trading has its positives and negatives. Likewise, foreign exchange trading also has its advantages and disadvantages.

As a potential investor, wishing to benefit from currency fluctuations or looking to hedge currency risks you may have to take well-informed and unbiased decisions with respect to futures trading over Over the Counter forex trading.

It is prudent to understand how cash forex and currency future differ from each other in the global forex markets. An Indian investor might find INR currency futures as more advantageous but it may not be so for other investors.