The Mumbai-based Bombay Bullion Association (BBA) is planning to set up a full-fledged spot bullion exchange in the country. The BBA is a pan nation bullion association which contributes to about 75% of the national bullion trade in the country.
The association is in talks with ADAG (Anil Dhirubhai Ambani group) company Reliance Money, Financial Technologies, and two other major parties. If this proposal materialises, it will be the first exchange in the country where spot bullion trading will be carried out an the electronic platform. ?Talks are on with major corporate groups including Reliance Money and Financial Technologies, for setting up a full-fledged spot bullion exchange. We are to finalise the deal with any particular party,? Suresh Hundia, president, BBA, told FE. BBA has already formed a special committee of eight members to decide on the proposal. However, according to market sources, BBA has already signed a memorandum of understanding (MoU) with Reliance Money for the proposal. As per the terms, the BBA-ADAG venture may tie up with the Bombay Stock Exchange (BSE) and infotech solutions company, IT People, at a later stage for providing an online trading platform.
The Reliance Anil Dhirubhai Ambani group has also decided to enter commodity-derivative trading by setting up a national commodity exchange in the country as part of its plans to capitalise on the vast opportunities in this segment. It is to be noted that the IBMA Spot Exchange was jointly promoted by Financial Technologies Group and the Bombay Bullion Association (BBA) in 2007 to launch a spot bullion exchange. As per the terms, Financial Technologies will hold a 51%-stake while BBA members would hold 17%, trade sources said.
Apart from the setting up of a spot exchange, BBA is also planning to launch a hallmarking centre and enable the process of setting the price of gold and silver on the lines of the AM/PM system in London.