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The World Bank/ Unctad will now focus on the development of safety standards at the commodity exchanges, as part of the modernisation of the commodity futures markets in India.

The Unctad official Lamon Rutten, who had prepared the first report for the re-introduction of futures trading in select commodities, has said that from the regulatory end restrictive and safety measures need to be built in for development of the markets.

Rutton was in Mumbai to attend the commodity financing and warehousing receipt system conference held last week.

He is of the view that the broking community (which has seen the return of futures trading in cotton, coffee) will have to adapt to the changing scenario or face the risk of being wiped out as commodity markets across other countries develop faster.

In an interview, Rutten said that measures were also being taken to revive the trading interest at the international black pepper futures exchange at Kochi. Views of Rutten on related issues:

Whether the process of development for commodity markets is satisfactory: "The pace could have been faster but it is heartening to see that the liberalisation/reform process has not been affected in a major way. There are areas like changes in essential commodities act, regulations relating to storage and stocking limits for commodities which need to be amended...and here the central bank needs to play a vital role."

On the estimated growth in agriculture sector: "Considering the circumstances, it is not a bad growth rate. The Unctad, as part of phase one, had looked at the restrictive aspects of commodity markets development - relating to pre-conditions and rules/regulations. Now the safety standards need to be ensured."

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