• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Mumbai , Jan. 10

The policy relating to foreign direct investment in commodity futures exchanges and foreign institutional investor ownership of such exchanges will be announced in about 4-6 weeks, said Mr Yashwant Bhave, Secretary, Union Ministry of Consumer Affairs.

He was addressing the national conference of commodity exchanges organised by the Forward Markets Commission (FMC) here on Wednesday. Mr Bhave urged the exchanges and market participants to ensure that the benefit of futures trading percolated to small and marginal farmers. "We have to strengthen the physical market by organising marketing yards, warehouses, quality standardisation and so on." Human resources are also scarce and need to be developed commensurate with market needs, he added. He said the Union Government would have to consider various aspects before taking a decision on FDI and FII ownership. He, however, did not specify what the considerations were.

Risk factor

Asked whether "political risk" to the commodity futures market would continue, the FMC Chairman, Mr S. Sundaresan, said irrespective of the existence of political risk, the Centre always had the powers to suspend/ban trading in any commodity, while Mr Bhave said the market participants would always have to factor in this risk.

As far as the banks, mutual funds and FIIs being allowed to participate to trade on the Indian commodities exchange platform, Mr Joseph Massey, Joint Director, MCX, said allowing these entities would provide market depth, which will be a good hedging platform.

Pre-budget representation include no imposition of service tax on commodity exchanges and, more importantly, allowing speculative losses to be considered as business losses and set off against business profits.

More Stories on : Commodity Exchanges | Policy | Foreign Direct Investment

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
`Policy on FDI in commodity exchanges in 4-6 weeks'

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line