NEW DELHI: Less a than week after the Indian government banned futures trading in commodities like rubber, chana, soya oil and potato, a section of bullion traders are pressing for a similar ban on gold futures.
On Sunday, the All India Sarafa Association, an umbrella body for bullion traders, sent a memorandum to India's Prime Minister Manmohan Singh and Finance Minister P Chidambaram asking for an immediate ban on futures trading in gold and silver.
According to the Assoication President Sheel Chand Jain, gold prices are going up and up these days becuase of futures trading, and the speculative trading undertaken by commodity players.
"The gold market in India has become unstable thanks to sudden rise and fall in the prices of yellow metal. In fact, the price flutuation in bullion prices, many times in a day, has created instability in the minds of consumers and adversely affected the bullion trade in India," Jain said.
Therefore, he said just as the government banned futures trading in agri commodities like rubber and soya oil, it is high time the government acted fast to ban forward trading in gold and silver.
Jain pointed out that India is the largest consumer of gold in the world, and futures trading has not helped the common man. "Gold prices have been volatile becuase of futures trading. People in India are genuine buyers of gold. But they are left high and dry these days because of the high prices of gold," he said.
Jain said the Association will meet Finance Minister Chidambaram to request him to ban futures trading in gold.
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