The days of ‘futures trading’ of agricultural commodities may be numbered, as the government is under pressure to ban the activity, given the surge in prices of essentials.
“I do not know how long I will be able to resist (the pressure),” agriculture minister Sharad Pawar said, commenting on the growing demand from political parties and others to ban agricultural-futures trading.
In the present dispensation (coalition government) and in parliamentary democracy, if all parties agree on the issue of withdrawing agricultural commodities from the futures market, it may finally prevail, Pawar said at a conference of vice-chancellors of state agricultural universities.
In view of the rising inflation, which is attributed to the spiralling prices of essential commodities, the number of people opposing futures trading in agricultural commodities has been swelling from day to day.
The parliamentary standing committee on food and public distribution opposed futures trading in farm products, saying it helps in inflation.
The agriculture minister, however, said there was no evidence that the futures trading was leading to price rise. Prices of urad and tur are still high, despite a ban on futures trading in these products, he said, adding the main reason was demand-supply mismatch.
Wheat export may be allowed
Meanwhile, Pawar said India will allow wheat exports if this year’s harvest is good. This came more than a week after the government had banned sales until December.
Lower temperatures in the main wheat-growing northern regions have raised expectations the crop, to be harvested by April, will be more than the forecast 72.5 million tonnes (mt), he said.
Last year, India had imported 5.5mt of wheat, following a rise in temperatures during the same month, which cut output.