Forward Markets Commission (FMC) is in the process to formulate guidelines for demutualisation of existing commodity exchanges and setting up of new commodity exchanges, said BC Khatua, chairman FMC. Khatua was speaking at a function organised by National Commodity and Derivatives Exchange (NCDEX) to launch its carbon credit contract on Thursday.
“We are in the process to prepare the guidelines for new exchanges and also for demutualisation of existing commodity exchanges. Demutualisation does not necessarily mean national status. FMC will finalise guidelines within a month or so,” he said. The ordinance lapsed on April 6 as it was not approved by Parliament within the stipulated six weeks, Khatua said.
“The Parliament is likely to discuss the FCRA Amendment Bill in due course and some minor changes are likely to be made before the Bill becomes an Act,” he said.
The Centre had notified an ordinance in February amending FCRA that conferred functional and financial autonomy to FMC. On banning of agri-commodities, he said that he is against any ban on futures trade as there was no merit that it led to price rise for the commodity.
He also said the government banned the four agri-commodities including wheat and rice last year but prices of these commodities have not come down despite a ban on futures trade.
On the scope of expanding more commodities in the futures trading list, he said that there is a scope and potential for launch of more new commodities like platinum, spices, dry fruits and raw sugar, ethanol and perishable products like mango, tomato, apple and orange on the futures platform.
On the launch of CERs contracts, he said India is the first developing country to offer a hedging tool for CERs, a Kyoto protocol compliant emissions instrument under the Clean Development Mechanism of the United Nations Framework Convention on Climate Change.