INDIAN COMMODITY MARKETS AND THEIR RELEVANCE TO THE ECONOMY

Journal Title: GJRA-Global Journal For Research Analysis - Year 2019, Vol 8, Issue 1

Abstract

It is unfortunate that in a predominantly agrarian economy like India, the full potential of commodity markets remains unrealised. Hedgers are unhappy with the hedging efficiency of our commodity exchanges although they are not that unhappy with their price discovery capabilities. Arbitrageurs do not participate actively since the transaction cost is higher. The resultant higher level of basis risk reduces the effectiveness of the hedge. It is often alleged that speculators do not show as much interest in agricultural commodities as they do in non- agricultural commodities. Even in agricultural commodities, they prefer only such items as are produced inadequately in the country and as are characterised by questionable and stale data. The market misses out on liquidity and the plight of the hedgers worsens. The country is woefully short of sophisticated, cost-effective and reliable warehouses.

Authors and Affiliations

Deepa T M

Keywords

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  • EP ID EP463847
  • DOI -
  • Views 63
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How To Cite

Deepa T M (2019). INDIAN COMMODITY MARKETS AND THEIR RELEVANCE TO THE ECONOMY. GJRA-Global Journal For Research Analysis, 8(1), 35-39. https://europub.co.uk/articles/-A-463847