FMC for growth of local commodity exchanges
Forward Markets Commission (FMC) is all in favour of regional commodity exchanges to grow simultaneously alongwith the national exchanges.
By TNN |
KOLKATA: Forward Markets Commission (FMC) is all in favour of regional commodity exchanges to grow simultaneously alongwith the national exchanges.
Inaugurating futures trading in raw jute here on Monday, FMC chairman S Sundareshan said since regional commodity exchanges have domain knowledge and expertise in commodity trading for a long time, it is important that they too should prosper alongwith the national exchanges.
Meantime, futures trading in raw jute resumes in East India Jute & Hessian Exchange on Monday, after a gap of 42 years. The trading was kicked off by Mr Sudareshan for deliveries in August, September and October ‘06.
Making it clear that FMC really wants the well-being of regional exchanges, Mr Sundareshan gives the exchange a green signal to initiate futures trading in some additional commodities, other than raw jute and jute goods.
“Since its members are conversant with perfect techniques and improvisations in futures trading for a long time, the exchange should go on adopting additional commodities for its healthy growth,” he said.
Replying to a query about the fate of the Bill on amending the Forward Contracts (Regulation) Act 1952, Mr Sundareshan said the Bill, which was placed in the Parliament in March, has been referred to a standing committee. The committee is expected to submit its recommendation on the matter by July, he added.
Subject to the committee’s approval, the amendments in the Act would enable the FMC to introduce ‘options’ into the commodity market. He further said FMC will soon ask exchanges and its members to conduct an audit on their performances, which will be made mandatory for them. The performance audit will primary focus on their functional aptitude.
To chalk out uniform standards for such auditing, the commodity market regulator has engaged a consulting firm, which has been asked to submit its recommendations next month, he said. FMC is working on bringing harmony in basic rules for contracts for future trading.
In this regard, it is working on standardising rules for initial margin, fixation of limit on volumes trading for each commodity to ease operations in all commodity bourses, he added.
Inaugurating futures trading in raw jute here on Monday, FMC chairman S Sundareshan said since regional commodity exchanges have domain knowledge and expertise in commodity trading for a long time, it is important that they too should prosper alongwith the national exchanges.
Meantime, futures trading in raw jute resumes in East India Jute & Hessian Exchange on Monday, after a gap of 42 years. The trading was kicked off by Mr Sudareshan for deliveries in August, September and October ‘06.
Making it clear that FMC really wants the well-being of regional exchanges, Mr Sundareshan gives the exchange a green signal to initiate futures trading in some additional commodities, other than raw jute and jute goods.
“Since its members are conversant with perfect techniques and improvisations in futures trading for a long time, the exchange should go on adopting additional commodities for its healthy growth,” he said.
Replying to a query about the fate of the Bill on amending the Forward Contracts (Regulation) Act 1952, Mr Sundareshan said the Bill, which was placed in the Parliament in March, has been referred to a standing committee. The committee is expected to submit its recommendation on the matter by July, he added.
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Subject to the committee’s approval, the amendments in the Act would enable the FMC to introduce ‘options’ into the commodity market. He further said FMC will soon ask exchanges and its members to conduct an audit on their performances, which will be made mandatory for them. The performance audit will primary focus on their functional aptitude.
To chalk out uniform standards for such auditing, the commodity market regulator has engaged a consulting firm, which has been asked to submit its recommendations next month, he said. FMC is working on bringing harmony in basic rules for contracts for future trading.
In this regard, it is working on standardising rules for initial margin, fixation of limit on volumes trading for each commodity to ease operations in all commodity bourses, he added.
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