According to a statement released after the talks, “the Indian side highlighted the potential in service sector cooperation and suggested cooperation in IT, financial services, education sector, tourism, healthcare, tele-medicine, medical tourism, and start-up ecosystem.” The Indian side also proposed establishing Mutual Recognition Agreements (MRAs) on professional services, internationalising the RuPay card, and implementing a QR-based payment system.

Last month, New Delhi and the United Arab Emirates signed a memorandum of understanding (MoU) to settle bilateral transactions in rupees and dirhams. In mid-July, on the sidelines of the G20 Finance Ministers and Central Bank Governors meeting in Gandhinagar, India, the two countries also discussed a local currency settlement plan.

India hopes that by negotiating local currency settlement pacts, it can increase the use of the rupee as a means of payment for international trade.

New Delhi’s total commerce with the Association of Southeast Asian Nations (ASEAN) in 2022-23 would be dominated by transactions with Vietnam, India’s fifth largest trading partner among ASEAN countries. According to the statement, “Vietnam is an important destination for India’s iron & steel as well as agricultural and animal products, mainly meat products, animal fodder, cereals, and marine products.”

Both parties agreed to hold regular and sustained bilateral discussions aimed at resolving market access issues and technical barriers faced by exporters in the areas of agriculture, fisheries, textiles, footwear, pharmaceuticals, chemicals, and fertilisers, among others, identified as key sectors for expanding trade cooperation.

“Both sides reviewed the progress on bilateral trade and economic cooperation and discussed ways to unlock the vast untapped potential in bilateral trade to enable the business communities from the two sides to benefit from the partnership of two of the fastest growing economies,” the statement read.

Also Read : Aeroflex Industries gets Sebi green light to float Rs 350-crore IPO

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Many investors are confused about how to properly handle the money they make from selling shares of stock in light of SEBI’s 20% block rule. It is possible that you will not know if the funds from an equity sale can be used intraday for a buyback, for futures and options trading, or for both.

Can I Use Equity Sale Proceed?

The key things you need to know in this regard are:

• You can put the money you get from selling shares of stock today towards other expenses anytime today.
• Still, you can’t spend the money you get from the transaction all at once. On the day of the sale, 80% of the revenues from the equity sale will be available.
• Any unused funds will be made available beginning on day T+1.
  
• A new stock or Futures and Options (F&O) position can be opened on the same day using 80% of the proceeds.
• It is important to watch the margin you keep when using the proceeds for intraday and buy-back deals. In the event of a shortfall, a margin shortfall penalty may be imposed.
• 

What To Consider While Using Equity Sale Proceeds?

If you are using your equity proceeds to carry out any other stock or F&O transaction, you must keep the margin shortfall in mind. Let us understand it further with the help of the below example.

Assumption – You have one share of MRF and zero dollars in your trading account. The stake is worth Rs. 1 lakh, and you decide to sell it for that price. A 10% share haircut has been imposed.

Trades during the day – You buy one lot of Nifty Futures that was available at Rs 95,000.

Effect – Your Nifty Futures margin need will be recorded as Rs (1,000,000 – 10% of 1,00,000,000) = Rs 90,000. As a result, the Nifty Futures position has a margin call of Rs 5,000. The exchange is permitted to impose a shortfall penalty on the same.

Margin reporting is not necessary for equity cash segments. For this reason, you need not worry about incurring any margin shortfall penalties if you invest the full Rs 90,000.

What Is The F&O Trade And Reported Margin Relationship?

The preceding makes it quite obvious that on the same day that stock is sold, eighty percent of the proceeds can be used to trade F&O. The equity transaction, however, has a settlement cycle of T+1 days. Therefore, on the day of the sale, the unrealized portion of the equity sales proceed is considered collateral margin. 

Brokers in F&O transactions have a reporting obligation with respect to the daily margin amounts owed to and collected from traders. This is determined by considering both their closed and open situations.

Final Words

When you invest the money from the sale of shares of stock in futures and options trading, you are essentially investing the proceeds from unrealized sales. The reported margin takes into account the percentage haircut taken on the equity sale. If this requirement isn’t met, a fine may be imposed. If you intend to invest the day’s equities gains in F&O contracts, you should have this in mind.

Also Read : When the stock’s price and futures contract are fluctuating, but the option contracts’ prices aren’t, what gives?

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In the past, all international transactions between Bangladesh and any other country had been conducted through the US dollar. Trade settlement in rupees was hailed as the “first step in a great journey” by Bangladesh Bank Governor Abdur Rouf Talukder. Indian High Commissioner Pranay Verma was also there for the event, and he remarked that “the trade position between India and Bangladesh has seen remarkable growth,” thanks to the two countries working together economically.

The governor of the central bank recently announced that a dual currency card accepting both the Taka and the Indian Rupee would be released in September, thereby lowering transaction costs for trade with India. However, Bangladesh and India do semi-officially stage frontier trading in specific localities dubbed “border hut,” where modest amounts of both currencies are exchanged. Under the new formal arrangement, officials have stated that from this point forward, trade will initially be conducted in rupee and then progressively in the Bangladeshi currency of Taka upon the trade disparity between the two countries diminishing.

Nostro accounts, or accounts in the banks of other countries, have been made available to financial institutions in Bangladesh and India for the purpose of conducting foreign currency transactions. Banks and market demand will factor into the final exchange rate, according to the officials involved. The most recent Dhaka statistics show that Bangladesh buys from India at the tune of USD 13.69 billion, while exports to India are USD 2 billion. However, several economists have warned that Bangladesh’s trade imbalance may prevent it from immediately reaping the benefits of the new system.

Nonetheless, Talukder stated that he was investigating more than just this USD 2 billion transaction because “we export and import in Indian rupees, it will have an effect on the exporters and importers in both countries.””We can significantly increase our exports because Indian consumers will be able to pay in Indian rupees and treat our goods as if they were made in India.”India is a sizable market, thus this will provide us with a significant opportunity. According to India’s ambassador to Bangladesh, bilateral ties have undergone “substantial transformation” during the past decade. “One of the most important manifestations of that transformation is our visibly growing economic and commercial ties and connectivity links,” he said, adding that Bangladesh is India’s largest trade partner in South Asia and the fifth largest globally.

Trade between the two countries has doubled in the last five years, he said. Over the past three fiscal years, annual shipments to India have exceeded $1 billion, and in the most recent fiscal year, they broke $2 billion. Bangladesh’s primary export market in Asia is now India, thanks to its large and varied consumer base.

Read Also : GST Council Gathering 2023: GoM determines to impose a 28% GST on online gambling, horse racing, and casinos.

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