CII & NCDEX Issued White Paper on a Warehouse Receipt Transactions Registry

Confederation of Indian Industry (CII) and NCDEX today released exclusive report titled “A case for establishing a warehouse receipt transactions registry” in connection with the Agri Supply Chain Industry .  The report was issued at a ‘Conference on Agri Supply Chain 2015’ on January 23, 2015 in Mumbai organised by CII.

Warehouse receipt financing is an important instrument to improve the credit access to agricultural producers. The efficiency of the inventory credit system in the country and the ecosystem that it creates for structured warehouse financing will go a long way in development of the agricultural sector in the country.  With commodity financing still not finding much support from the banking fraternity, the white paper  throws light on how warehouse receipt transactions registry will help in bridging the information gap and help in confidence building. It looks at different aspects of warehouse receipt systems across the world and builds a strong case for Warehouse Receipt Based Transactions Registry (WRTR) and also from the perspective of Common Clearing.

Speaking at the event, Mr. Samir Shah, MD & CEO of NCDEX said, “Warehouse financing is a crucial enabler in the holistic development of the agricultural markets in India and there is a perceived trust deficit that the banks have as far as the sector goes. An electronic registry, which provides transparency and tracking of commodities in every single warehouse in the country it will go a long way in giving comfort to the banks and this can be the single biggest game changer for the industry. This is in line with the development in the Indian capital market which has witnessed several initiatives that have helped in bringing transparency to the trade and building confidence among the participants.”

Mr. Anil Choudhary MD & CEO National Bulk Housing Corporation (NBHC) said that “Agriculture is crucial in India as over half population derives its livelihood from agriculture but they are among the poorest.  India runs one of the largest farm produce support programme in the world but the majority of the farmers, the small and marginal ones realize only 35 % of the value they produce. Most of the money goes into the hands of intermediaries. Attracting institutional finance from banks is a must in this scenario.”

ABOUT NCDEX:

As India’s leading online exchange, NCDEX is where customers repose trust. It offers the widest range of benchmark products across agriculture, metals and precious metals. NCDEX brings buyers and sellers together through its electronic trading platform. With a widely held shareholding, it enjoys the distinction of being the only exchange in the country promoted by national-level institutions. The institutional promoters and shareholders of NCDEX are prominent players in their respective fields and bring with them institutional building experience, trust, nation-wide reach, technology and risk management skills