India for transparency futures and OTC markets

Paris: India, a major crude oil importer, Friday pressed for transparency in futures and over the counter markets stating that the volatility in commodity prices is causing inflation in emerging economies.

"India is major commodity importer, and hence India supports the need to improve information and transparency in futures and OTC markets," Indian Finance Minister Pranab Mukherjee said in his bilateral meeting with his French counterpart Francois Baroin here. Mukherjee said while New Delhi is committed to the phasing out of fuel subsidies, "there is no one-size-fits-all model to implement the fossil fuel subsidy reform".

But as India is a "price taker", phasing out of subsidies have inflationary pressure on the economy, he said. "Some mechanism for stabilising or smoothening price movement has to be found," he told his French counterpart.India also supports a critical review of the unbridled financing of commodity derivative market so that some restrictions are placed on access of large financial investors to the market.

The concern of emerging markets, like India, which are the major commodity importer emanates from the fact that prices quoted in major developed markets act as benchmark leading to volatility. India imports about 80 per cent of its crude oil requirements and is grappling with a near double digit inflation, which is having an impact on its economic growth as well.