This is one of the most asked question on my blog related to Forex trading. And the answer for this question is YES and NO. You can trade legally in India for currency pairs provided by MCX exchange. Most of the major stock brokers are providing currency trading in INR pairs through MCX exchange and the pair they provide are USD INR, EUR INR and GBP INR. Trading in these contracts are legal in India. The market for these contracts have also become very liquid lately and it would be a good starting point for someone who want to test water of currency trading. But what most people are interested in knowing is can they trade in global currency pair namely USD:EUR or GBP:YEN and the simple answer for this is NO you cannot trade in them legally from India. By this I mean that as per RBI policy, you are not allowed to trade in international currency pair full stop.