With the government extending its ban on forward trading in more agricultural commodities, a section of jewellery traders has sought a similar curb on gold and silver futures as well to curtail the volatility in rates.
City-based All India Sarafa Association's President Sheel Chand Jain on Thursday told PTI that it is planning to write to the Prime Minister and the Finance Minister seeking a ban on futures trading in gold and silver on MCX, the leading commodity exchange of India.
The government suspended futures trading in soya oil, potato, rubber, chana (gram) on Wednesday, while rice, wheat, urad and tur were banned early last year.
"Sudden rise and fall in prices of gold and silver, many times in a day, has created instability in the minds of consumers and adversely affected the bullion trade," the association said in a statement.
"This fluctuation in the metals is due to MCX trading, besides involvement of speculators," it added.
However, another industry association, All India Gems and Jewellery Trade Federation's Chairman Ashok Minawala opposed the demand for banning forward trading in gold and silver, saying the volatility cannot be avoided by a ban on futures trading.
"The volatility in the prices of gold and silver cannot be avoided. I don't see any reason for banning the precious metals as we cannot control the international prices," Minawala said.
