Nagpur: The Centre has notified the mineral exchange rules last week, paving the way for starting country’s first-ever exchanges for trading of ores, the direct output of mines. Nagpur-based Indian Bureau of Mines (IBM) has been appointed as the monitoring authority.The plan is to initially start with Schedule 1 minerals like iron ore, bauxite or even gold in its raw form and then expand, said sources.IBM would seek offers from interested entities having plans to operate as registered exchanges. Even the existing commodity bourses like MCX or NDEX can apply. The case would be put up before the Centre for a final approval. The process is expected to be completed within 90 days, a source said.Commodity exchanges in the country deal with metals, which are the processed form. The new exchange would directly deal in ore, informed the sources.The purpose of having the exchange is to get a fair price discovery mechanism for mineral ores. At present, the rates are based on average prices published by IBM in its journal from time to time. Eventually, the rates derived through the exchange would be official, though initially it may not be mandatory, said a source.As per rules, the mineral exchange will have to maintain minimum net worth of 50 crore at any given point of time. In case it falls, the IBM has the right to seek a written explanation.The mineral exchanges will have to submit the monthly details of all the transactions on its platform to IBM, which shall also keep an eye on the activities to prevent any market manipulation, insider trading or cartelisation.The rules also give IBM the right to conduct any investigation in event of noncompliance of any of the obligations or acts like manipulation,cartelisation and abuse of dominant position, say the rules.
