Currency futures to help realise IFC dreams

The Budget proposal to introduce exchange-traded currency and interest rate futures and a transparent credit derivatives market are part of the move to make Mumbai an international financial centre (IFC), say experts.

Finance Minister P Chidambaram has proposed the launch of exchange-traded currency and interest rate futures and transparent credit derivatives market to be developed with appropriate safeguards.

Experts said the launch of these two financial instruments were part of the recommendations of the Percy Mistry Committee to make Mumbai an IFC.

Maharashtra Finance Minister Jayant Patil said, these measures would go a long way in realising the IFC dream for Mumbai as many more foreign financial institutions would open shops here while the existing foreign players might look to expand their activities.

A senior official from the state government who is associated with state government's Mumbai Makeover Plan also endorsed the state finance minister's view.

He said, "The Persy Mistry Committee had suggested the deepening of our financial markets by introducing futures trade in the currency and interest market and yesterday's finance minister's announcement is definitely a step in the right direction."

"This was a policy initiative we were waiting from the central government as state has already done its bit by abolishing the Urban Land Ceiling Act. The state government was also taking measures to rectify property tax structure in the city and taking various initiatives on the infrastructure sector," he added.