SEBI Eyes Wider Non-Agri Commodity Derivatives Access
Why in the news
SEBI began exploring ways to widen participation in commodity derivatives, focusing on the non-agriculture segment.
Key facts
- Institutions: SEBI will consult the government about allowing banks, insurers and pension funds, currently restricted.
- FPIs: possible entry into non-cash settled, non-agricultural contracts, improving liquidity and global linkage.
- Scope: metals, energy and other industrial commodities; farm derivatives are left out as politically and socially sensitive.
- Brokers: unified reporting system by December.
Working group agenda
- Real-time margin collection.
- New exchange products.
- Logistics support, including critical mineral exploration tools.
- More SME participation and possibly select derivatives for FPIs.
MCX plans
- Widen metal-contract participation among commercial users (producers, consumers) and financial users (brokers, investors, mutual funds, ETFs, banks).
Exam angle
- Regulator: SEBI; exchange named: MCX.
- Derivatives are contracts like futures and options whose value comes from commodities such as gold or oil.