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G.K. Nair

KOCHI, Jan. 22

THE proposal to begin online pepper futures trading at the International Commodity Exchange (ICE) is yet to see light with no consensus in sight among the members of the India Pepper and Spice Trade Association (IPSTA), the promoter of the exchange.

Some members opposing online trading have submitted a representation to IPSTA to discuss the points raised by them at an extraordinary general body meeting.

An EGM of the association is likely to be convened in about two months time.

Almost 50 per cent of the 186 members of the IPSTA were against introducing online trading on ``unfounded and flimsy grounds'', Mr Sanjay Mariawala, Chairman of the on-line trading committee of the Association, told Business Line.

Their apprehension was that the introduction of such facilities would raise the cost of trading. But these fears were not supported by factual figures, he said.

Meanwhile, Mr Kishor Shamji, President, IPSTA, said electronic trading was a costly affair and ``we are exploring ways and means to go ahead with the project in a better manner''.

However, the IPSTA did not want to jump into the project lest it would meet with the same fate as some of the new exchages which went online last year, he said. ``We are taking a steady and cautious approach''.

Introduction of online trading would bring more foreign traders enhancing the trading volumes.

With initial investment coming around Rs 50 lakhs, IPSTA was negotiating with a couple of service providers, Mr Shamji said.

``We could make some initial down payment and then the provider could get the balance money from daily trading.''

Various options such as sharing the facility of Mumbai Commodity Exchange was also being considered, he said.

If such facilities were created, there was a possibility that it could be used by other commodity exchanges as copra and coconut oil and even the proposed rubber exchange.

He added that IPSTA had already approached the Common Fund for Commodities (CFC) seeking financial assistance for the project.

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