Saturday, October 09,
Tighter regulation of commodity markets is on the cards, even as the Government seeks to ensure wider participation of financial entities.
Addressing a meet on the plans of NCDEX, its Managing Director and CEO, Mr R. Ramaseshan, said, “The opening up has to be done cautiously, as a graded process, to ensure that it does not distort the price discovery system and the integrity of the process does not suffer. Surveillance mechanisms would have to be strengthened.”
While elaborating on NCDEX’s entry into Steel and Oil, Mr Ramaseshan said that “in metals, India is a price follower, with a limited role in price discovery.” However, he said that the commodity exchanges “are poised for growth” in view of the growth prospects of India and China.
The traded value in metals (other than bullion) increased by 72 % in the first half of this fiscal.
The proposed amendment to the Forward Contracts Regulation Act aims to strengthen regulation, introduce a greater variety of financial instruments and to ensure wider participation, Mr Ramaseshan added.
Source: The Business Line
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