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After falling for two years, futures trading in agri-commodities grew 48% in 2009 over the previous year to Rs10.88 lakh crore.
After falling for two years, futures trading in agri-commodities recovered in 2009 and grew 48% over the previous year on the back of the government lifting the ban on fututres trading in five farm items, the Economic Survey said on Thursday, reports PTI.
"Agriculture commodity futures staged a remarkable recovery after steady decline over the last two years," the pre-Budget statement on the health of the economy said.
The turnover from agri-futures rose 48% to Rs10.88 lakh crore in 2009 from Rs5.22 lakh crore in the previous year, it said.
The Survey noted that the year 2009 started on an optimistic note after the government revoked the ban on futures trading in chana, soy oil, rubber and potato in December 2008, while the ban on wheat trading was lifted in May 2009.
The ban on trading in sugar futures, however, will remain till September this year, it added.
According to the Survey, the total value of trade in the commodities futures market rose to Rs70.90 lakh crore in 2009 from Rs50.34 lakh crore in 2008.
The Multi Commodity Exchange (MCX) recorded the highest turnover of Rs59.56 lakh crore in 2009, followed by NCDEX at Rs8.05 lakh crore and NMCE at Rs1.95 lakh crore.
Farm commodities, bullion and energy accounted for a large share of the items traded in the commodities futures market last year.
Currently, there are four national level and 19 regional commodity exchanges in the country.
The Opposition parties have charged the government with 'failure' to check rising prices and demanded a Parliamentary probe of the ‘scam’ in pricing of essential commodities like wheat, rice, pulses and sugar
The Opposition parties on Thursday sought to puncture the economic growth story, charging the government with "failure" to check rising prices and demanding a Parliamentary probe into the "scam" in pricing of essential commodities like wheat, rice, pulses and sugar, reports PTI.
Launching a scathing attack in both Houses of Parliament on the issue of price rise, the Bharatiya Janata Party (BJP) and the Left coalition alleged that the United Progressive Alliance (UPA) was indulging in a blame game instead of controlling runaway inflation, particularly of food items.
After stalling proceedings for two days on the issue, the Opposition mounted a fresh offensive on the government through a structured debate simultaneously in both Houses, skipping the customary Question Hour.
The government came under attack on a day when the pre-Budget Economic Survey painted a rosy picture of the economy, projecting GDP growth of 7.2% for the current financial year and 8.75% in the next fiscal.
Despite some measures like export checks and import liberalisation, food inflation is ruling at 17.58%.
Leading the attack in the Lok Sabha, Leader of Opposition Sushma Swaraj said, "We demand a Joint Parliamentary Commission (JPC) to enquire into the scams in wheat, rice, pulses and sugar". She said the probe should find out why decisions which led to "scams" were taken.
She quoted a Bollywood film dialogue about 'maal idhar se udhar karna' (wheeling-dealing) and said "the government is doing this and the matter should be investigated".
Ms Swaraj claimed the government imported and exported sugar ‘simultaneously’. The sweetener was being exported at Rs12.5 per kg and imported at Rs36 per kg at the same time. She said total profits of the 33 listed sugar mills jumped from Rs30 crore in October-December 2008 to Rs901 crore in the same period next year. "It is a jump of 2900%. This is a scam and it needs to be investigated," she said.
Ms Swaraj said the Food Security Bill would be a futile effort if the government did not have correct figures of those who should be covered under it.
In the Rajya Sabha, leader of Opposition Arun Jaitley said the situation reflected ‘complete inaction’ of the Manmohan Singh government and lack of coordination between the Prime Minister's Office and various ministries.
Mr Jaitley said the statement in the Congress mouthpiece, Congress Sandesh, that “some practical difficulties in coordination between the PMO and various ministries are natural in a coalition government” was a confession of lack of cohesion between ministers responsible for controlling prices.
"Leadership is not an art of making compromises for the sake of coalition. We cannot live with a system where PMO feels helpless," he said.
Slamming the Union government for indulging in a blame game over the rising prices, the Left said the government will have to make a policy shift to arrest the situation, which it termed as a fall-out of economic liberalisation.
"Government is not ready to accept its failure but only engaging in a blame game. Do not make it an issue of ego. You will have to make a policy shift," Brinda Karat (CPI-M) said.
Alleging a scam in sugar prices, she said the government's "manipulative policy" is responsible for it and demanded constitution of a JPC or a white paper to "expose this and make someone accountable".
She alleged that sugar millowners profited hugely at the cost of farmers and consumers.
Pranab Mukherjee will present the Budget for 2010-11 on Friday amid speculation that taxes may be raised as part of a partial rollback of stimulus prescribed by the government's advisers.
Finance minister Pranab Mukherjee will present the Budget for 2010-11 on Friday amid speculation that taxes and duties may be raised as part of a partial rollback of stimulus prescribed by the government's advisers, reports PTI.
However, direct tax rates are not likely to be altered for the time being as the finance ministry is likely to wait for implementation of the Direct Tax Code from 2011-12 before initiating any change.
The Direct Tax Code, which will replace the archaic Income-Tax Act, is unlikely to come in the Budget session, sources said.
The debate on withdrawal of stimulus measures introduced in the wake of the global economic slowdown since late 2008 intensified on Thursday with the Economic Survey of the Finance Commission favouring a gradual rollback of stimulus to check strains on government finances, but India Inc wanted the sops to continue to push up economic growth further.
The Economic Survey tabled in Parliament on Thursday suggested that stimulus be withdrawn gradually, since the economy is on the rebound and the growth is broad-based.
"The broad-based nature of the recovery creates scope for a gradual rollback, in due course, of some of the measures undertaken over the last 15 to 18 months," said the Survey.
The Finance Commission also recommended "a calibrated exit strategy from the expansionary fiscal stance of 2008-09 and 2009-10."
Last week, the Prime Minister's Economic Advisory Council had pitched for raising excise duty to the level of service tax and broadening the service tax net as part of stimulus withdrawal. Currently, excise duty stands at 8% and service tax at 10%.
However, the industry is of the view that the government should continue with these incentives in the upcoming Union Budget to ensure high economic growth.
"For higher growth, the government will have to adopt a calibrated approach and continue with stimulus package for at least another fiscal," Assocham president Swati Piramal said.
FICCI president Harsh Pati Singhania said: "Government should continue with stimulus measures, as the growth in the industrial and export sector is mainly because of this support."
A roll-back of stimulus basically means raising of indirect taxes, which were reduced earlier, and compressing expenditure.
In the wake of the global financial meltdown, the Union government reduced excise duties by 6% and service tax by 2%, besides stepping up plan expenditure to provide Rs1,86,000-crore stimulus to accelerate the country's economic growth.
This has helped economic revival, with GDP growth galloping to 7.9% in the second quarter of this fiscal, compared to 6.1% in the previous quarter and 5.8% each in the preceding two quarters. This year, GDP growth is pegged at 7.2% against last year's 6.7%.
However, the stimulus measures also widened the fiscal deficit to 6.2% of GDP during 2008-09, from the Budget estimate of 2.5%.
The fiscal deficit is projected to widen to 6.8% in the current fiscal.