Govt may ban futures trading: Nath

Warning that the battle against inflation will fail if states do not join hands with the centre, Commerce and Industry Minister Kamal Nath today said the fresh offensive on price control may include a ban on forward trading and bringing steel under ESMA.

In an interview to CNN-IBN, Nath said,"If the states are not going to exercise the power they have to check profiteering, hoarding, it (fight against inflation) is going to collapse." He said the Centre needs to prevail more strongly on the states to take effective steps for arresting the price rise.

With the government facing protests from political parties and public outcry on inflation, which is hovering over 7% mark, the Centre is asking the states to take stringent measures against hoarders and profiteers.

According to Finance Minister P Chidambaram, Prime Minister Manmohan Singh is likely to convene a meeting of chief ministers on the issue.

Asked whether the government would ban futures trading, Nath replied, "If forward trading is the reason of inflation, why would not we do it. We want to contain inflation." The government informed the parliament last week that it was awaiting the report of the Abhijit Sen Committee on the impact of futures market on prices and would take a decision if the report is received within 10 days.

As for steel, which has seen a price rise of 49 per cent in the last one year, Nath said if the states failed to rein in inflation, the Centre was prepared to take stern action.

"In the end we will have to think of steps. You know there are steps such as the Essential Commodities Act for steel such as 18 (G) of the Industrial Development Regulation Act," he said.