The role of future trading in commodity markets has often been a subject of controversies in India, between those who look at future markets as a guiding force for price discovery, risk sharing and market efficiency and others who contest such claims, maintaining that future trade has been responsible for speculation-led price increases, especially as at present. Prof. Sunanda Sen, formerly senior professor at the Centre for Economic Studies and Planning (CESP), Jawaharlal Nehru University, writes.
Prasenjit Bose reacts to the cacophonous criticism of the government's decision on retaining ban on futures trading of certain food commodities. He asks; in the context of high inflation and price rise of essential commodities, the government has to now decide whom to give the “benefit of doubt”: the speculators in the commodity exchanges or the public procurement and distribution system? Attached with the article are the report of the Expert Committee on Futures Trading and supplementary note of the Chairperson of the committee, Prof. Abhijeet Sen.
Any government of the day is duty-bound take measures to insulate ourselves from such global speculation and protect the livelihood of our people. After all, if inflation is a global phenomenon, so is bird flu. Do we not take measures to protect ourselves from the spread of this disease?, asks CPI(M) Politburo Member Sitaram Yechury