The Hindu Business Line : FMC to raise staff strength

THE total aggregate volume of commodities exchanges in the country has touched Rs 4,00,000 crores during the 10 months of the current financial year from Rs 30,000 crores a few years ago, Mr S. Sundareshan, Chairman of the Forward Markets Commission (FMC), said here on Thursday.

At a seminar on `Gaining Insight into Crude Oil Futures Trading,' organised by the Multi-Commodity Exchange of India (MCX) held here, he said the total trading volume of the country's commodities exchanges had increased phenomenally during the year following the commencement of multi-commodity exchanges.

"Our first and foremost priority is to increase human resources strength by adding new staff and upgrading technology at the FMC offices. Also, we are looking for more space to accommodate the increased staff strength," Mr Sundareshan said.

On regulatory powers of FMC, Mr Sunderashan said: "FMC has all the powers like SEBI and it is capable to take appropriate actions as and when required, such as suspension of commodity brokers and actions against illegal trading."

On the convergence of the Securities and Exchange Board of India (SEBI) and the FMC, Mr Sundareshan said: "The Union Government has to take a decision in this regard."

On permission for foreign institutional investors and mutual funds to enter commodities markets, Mr Sundresan said: "The issue should be taken very carefully. It needs some technical study."

Mr Richard Savage, Global Head (Commodities Research and Strategy), Bank of America, said, in his presentation, that crude oil prices in year 2005 were expected to be stronger than last year as more and more hedge funds were parking funds into the oil markets.

Mr Mani Shankar Aiyar, Union Petroleum Minister, is likely to launch crude oil futures trading at New Delhi on February 9.

There will be 12 contracts in a year. Quality specification is light sweet crude oil. Trading unit is 100 barrels and quotation base is Rs/per barrel ex-Mumbai.

Daily prices limit and initial margin will be 4 per cent and 5 per cent, respectively. Delivery centre is Mumbai/JNPT port installations and delivery unit is 50,000 barrels.

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