'Rising inflation has little to do with futures trading'
The futures market did not contribute to the current inflationary trend and it was wrong to blame it for the prevailing shortage of essential commodities such as foodgrains, pulses and edible oils.
By PTI |
MUMBAI: The futures market did not contribute to the current inflationary trend and it was wrong to blame it for the prevailing shortage of essential commodities such as foodgrains, pulses and edible oils, NCDEX���s former CEO and MD, P Ravikumar, said.
The futures market is at best a shock-absorber, no more. For dealing with the crisis, the government must address the real cause of the malaise, which lay elsewhere, Mr Ravikumar said, addressing a seminar on "Ban on agri product futures-pros and cons," organised by the Indian Merchants��� Chamber (IMC), here on Thursday.
Mr Ravikumar said the Forward Markets Commission (FMC) ignored the need to promote transparent spot markets in commodities, but promoted the futures market in 2002.
"Today, we do not have spot markets in commodities. And it is too late to reverse the wheel. The free market mechanism works best where the spot and futures markets function parallel in a transparent way," he added.
The futures market is at best a shock-absorber, no more. For dealing with the crisis, the government must address the real cause of the malaise, which lay elsewhere, Mr Ravikumar said, addressing a seminar on "Ban on agri product futures-pros and cons," organised by the Indian Merchants��� Chamber (IMC), here on Thursday.
Mr Ravikumar said the Forward Markets Commission (FMC) ignored the need to promote transparent spot markets in commodities, but promoted the futures market in 2002.
"Today, we do not have spot markets in commodities. And it is too late to reverse the wheel. The free market mechanism works best where the spot and futures markets function parallel in a transparent way," he added.
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