The Multi Commodity Exchange of India Limited (MCX) and India Bullion & Jewellers Association (IBJA) have signed a memorandum of understanding (MoU) for increasing collaboration between the two bodies including jointly exploring the setting up a bullion spot exchange in the country.
In a statement announcing the collaboration, MCX said that a bullion spot exchange is in line with the vision of Government of India of setting up a trade-efficient and consumer-savvy system of regulated gold exchange in India for bullion stake-holders for efficient price discovery and transparency.
MCX MD and CEO Mrugank Paranjape said that establishing an exchange would also help create a vibrant gold ecosystem and would lead to greater assurance in the quality of gold being supplied.
The statement also noted that such a step would provide for a robust settlement mechanism, multiple delivery centers, active retail participation, greater integration with financial markets, and would also boost recycling.
Additionally, the MoU outlines some of the other areas of collaboration planned. These include undertaking the organising of joint seminars and awareness programmes on price risk management for bullion traders and jewellers across the country and helping the small and medium enterprises move to more organised forms of trading. Education would also be provided about effective hedging tools such as gold derivatives contracts-futures and options that will enable jewellers to maintain efficient books of accounts, the statement said.
News Source: gjepc.org
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