Current Affairs

Chandan Sinha Panel Proposes to Hedging Commodities in Global Markets

A Working Group of RBI headed by Chandan Sinha has proposed RBI to hedge commodities in global markets.


  • The panel has made a "positive list" of commodities comprising metals, energy and agro products which can be hedged in the overseas markets by domestic traders.
  • Presently, most of the hedging activities are in base metals through a reasonably wide variety of products are hedged offshore by Indian corporates.
  • The proposed list includes gold, silver, zinc, tin, crude oil and its derivatives, coal, natural gas, tea, coffee, sugar and cocoa.
  • One of the 10 recommendations of the Group also pertains to banks in the hedging activities.
  • The panel also suggested to implement a uniform approach in extending facilities to hedge commodity price risk in overseas markets that is agnostic to the place of procurement of the commodity.
  • The Reserve Bank had set up a working group to review the guidelines for hedging of commodity price risk by residents in the overseas markets during the development phase of the domestic commodity derivative market.
Chandan Sinha Panel Proposes to Hedging Commodities in Global Markets  Chandan Sinha Panel Proposes to Hedging Commodities in Global Markets Reviewed by insiya yadav on November 18, 2017 Rating: 5

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