"Ice for pepper is in a limbo. There is no major activity in the exchange and virtually no trading since February," Sanjay Mariwala, president of the Indian Pepper and Spices Trade Association (Ipsta) which runs the exchange told PTI over phone from Kochi.

A major reason for the exchange failing to take off was that Ipsta has been able to rope only one international member. "We have just one international member from Holland for the exchange," Mariwala said.

Former Ipsta president N Vidyasagar, who was instrumental in getting the exchange commenced in November 1997, said trading had come to a virtual standstill at the bourse.

"It is a minor problem. Government has done its job by fulfilling traders demand. It is for the traders to implement various things sanctioned by government," hesaid.

When contacted consumer affairs secretary K Srinivasan said government could only facilitate smooth functioning of commodity exchanges and could not be expected to run the bourses on its own.

The Forward Markets Commission (FMC), which regulates the commodity markets in the country, functions under the consumer affairs ministry.

Mariwala conceded that government was upset over the functioning of the ICE as it was not being reactivated despite steps taken by it to support the bourse.

One of the major initiatives taken by government to reactivate the exchange was to allow trade in dollar denomination. Government allowed such transactions to attract better response from overseas players.

"There have been some laxity on the part of people manning the exchange now. Dollar trading was allowed in November last year and it is yet to be implemented," Vidyasagar regretted. But Mariwala said there were some problems in starting trade in dollars. "We have to develop new mechanism to launch dollarcontracts. For that, the risks will have to be understood properly," he added.

As a result of the virtual standstill of the transactions at the exchange, a proposal to launch international roadshow has been dropped. Mariwala said a proper package had to be got ready by the bourse before the international roadshow was launched.

"Before doing anything, we will have to figure out an alterative to reactivate the exchange," he said. Both the commerce and consumer affairs ministries had allocated funds for the roadshow during 1998-99 fiscal but took them back as it was unutilised.

Vidyasagar, who now heads the marketing division of the International Pepper Community (IPC) said the organistion had come forward to help Ipsta in the smooth functioning of the exchange.

"But the response was rather poor. There is no impetus on the part of the promoters," he charged. Mariwala, on the other hand, said Ipsta was unable to convince members of the domestic pepper bourse to take part in the transactions ofICE.

"Members are happy trading at the domestic pepper exchange. So they do not want to risk trading in the international bourse," he said.

However, Ipsta was contemplating on how Indian players could take part in the International Pepper Exchange.

While the international pepper bourse has been witnessing a poor turnover, the domestic pepper exchange has been functioning successfully for over five decades now with the average daily turnover being above 600 tonnes a day.

Even the domestic pepper exchange is facing problem now as it has not yet fulfilled its obligation to extend contract guarantees to buyers and sellers leading to the FMC not permitting any forward contracts beyond August.

Under the present situation, forward trading can go on in the domestic bourse until August 15 only.