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Dhimant Bhatt

Mumbai , May 13

BARRING sugar and bullion, most commodities are unlikely to be impacted by any political volatility due to the change in Government.

However, worries about the continuity of economic reforms may surface, commodity traders said.

Today, sugar showed a marginal recovery of Rs 10-15 per 100 kg but bullion prices weakened because of currency fluctuation.

Cotton, non-ferrous metals and edible oils remained largely unchanged.

The bullion market was volatile due to currency fluctuation because of political uncertainty.

Rupee volatility will continue to influence bullion prices, a local bullion dealer said.

Silver was down Rs 110 per kg and gold was down Rs 75 per 10 gram on Thursday.

"My only suggestion to the new Government is that they should allow re-export of gold," he said.

According to a leading sugar merchant, it is too early to comment about the formation of Government. "But I think that if a Congress-led Government comes into power, the current sugar policy will be continued. Good days are ahead for the entire sugar industry."

He added: "A coalition Government should continue the current public distribution system (PDS) for lower and middle class families by supplying essential commodities such as food grains and sugar. It is true that the Congress Government had started the liberalisation process but it will not decontrol the sugar industry."

"Shifting of political power was inevitable as the NDA government was failed in fulfilling their promises given to farmers. Drought conditions in Mahrashtra/Andhra Pradesh, farmers' suicide cases, water shortage and higher power tariffs were the major issues for farmers," a leading agri-commodity trader said.

A local cotton textile trader said: "Looking at the Lok Sabha election results, I believe the country may witness another around of elections in the next few months. As far as textiles is concerned, revival of many sick textile units will be affected due to change at the Centre."

Mr Sanjay Kothari, Chairman of the Gems and Jewellery Export Promotion Council, said: "A coalition Government will certainly be industry-friendly, particularly for gems and jewellery sector. The Government should continue economic reforms further."

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