The Hindu Business Line : FMC to convene meeting of regional exchanges

Kochi, Aug 17 The Forward Markets Commission will convene a meeting of the 21 regional exchanges in the countryto prepare a plan of action for their revitalisation, Mr B.C.Khatua, the Commision’s Chairman, said.

He told reporters that the Commission had circulated a note to these exchanges and an agenda will be set according to the feedback received from them. The meeting is likely to be convened in October or November.

Mr Khatua was here on Friday to launch the new scheme of the Federal Bank for financing delivery-based trade through commodity exchanges. He saidthe commodity futures trading in the country had reached a saturation level due to operational constraints. Lack of quality warehousing and difficulties in forming uniform standards for benchmarking each commodity were some of the issues faced by the commodities market.

The ban imposed by the Union Government on futures trading in wheat and pulses etc had also impacted the growth of the market. He said the turnover in the commodity exchanges fell by 6 to 7 per cent in the first four months of thefiscal compared with last year. The decline was not significant given the constraints, he added.

According to Mr Khatua, permission for banks and mutual funds in commodity futures trading will help to bring in more liquidity in the market. He said the Abhijit Sen Committee appointed by the Union Government to study the impact of futures trade in essential commodities was awaited.

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