MCX to study viability of setting up operation in GIFT City

After the merger of the regulatory bodies SEBI and FMC, MCX will be facing competition from the equity exchanges namely NSE and BSE. The Stock Exchanges are on a wait and watch mode as it is feared that SEBI may not give approval for the Stock Exchanges to set up Commodity Exchange and vice-versa since it may not be easy to understand the nuances of the 2 different set-ups and also to protect the Commodity Exchanges since they are in their infancy stage compared to the Stock Exchanges.

In an interview to Hindu, Ahmedabad which was published on September 7 2015, P K Singhal Joint MD of MCX said that he feels that there is a need to look at the current set-up for GIFT City. The Exchanges which set-up operations in GIFT are allowed to enter into dollar denominated contracts in order to woo foreign investors. This will help the Indian investors to start trading in contracts wherein they were not allowed earlier by some of the International Exchanges. This creates a major opportunity for Indian investor community to have a global impact on currency trading.

As the clarity on taxation and other issues are awaited, MCX is going slow on the project to set up operations in GIFT. Once there is a clarity on taxation front, MCX will take up a viability study to check on the pros and cons of setting up operations in GIFT and thereafter take it forward. Only if the project looks viable, MCX will further strategize and set-up its operations.








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