The Governor of State Bank of Pakistan Dr Ishrat Husain has asked the National Commodity Exchange Limited (NCEL) to ensure protection of small farmers' interests. He stated this during his visit to the NCEL here on Friday.
The Chairman and Managing Director of NCEL, Salim Chamdia and Assim Jang, respectively, briefed the SBP Governor.
Presidents of MCB, UBL and Union Bank, Chairman Karachi Stock Exchange and senior bankers were also present.
Dr Ishrat said that it was truly inspiring to see NCEL taking on such initiatives and it was encouraging to see that this organisation has such a great team and dedicated players.
He said that it was a very crucial period for NCEL and, in order for it to not only take off but to succeed as well.
The Governor was of the view that the NCEL must develop a competent marketing team. He said that it was vital that NCEL must ensure to keep the small farmers in its reach as the stronger farmers are already protected.
Dr Ishrat commended NCEL for introducing the warehouse receipts, stating that the banks were struggling with this for a while and it was a development that the market required.
He said that since NCEL is demutualised it can anticipate a frictionless launch.
Salim Chamdia said that NCEL, being the only demutualised exchange and the only commodity exchange, is keeping in view that it would be responsible for providing quality benchmarks for the future of the market.
Assim Jang said that one of the most important initiatives of the NCEL is to introduce the concept of collateral management in Pakistan which would provide logistic support from farm to farm FOB and ensure adequate accredited warehousing space as well as quality and quantity warehoused goods.
This collateral management would guarantee and insure its warehouse transactions and would be key in enabling the warehouse receipt financing by mitigating operational risks and upgrading credit rating.
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