NSE Launches A Platform To Accept Gold Bars Produced By Indian Refiners

New Delhi, Jul 10: The National Stock Exchange of India Friday said to accept gold bars produced by domestic refiners for settlement of gold futures contracts on its newly launched platform, called NSE Refiner Standards for Bureau of Indian Standard (BIS) - Standard Gold.

"The NSE Refiner Standards for BIS – Standard Gold - would enable the acceptance of gold bars produced by domestic refiners in India, for settlement of the gold futures contracts traded on the NSE platform," the exchange said in a statement.  

Until Thursday, NSE had been accepting serial-numbered gold bars produced and approved by London Bullion Market Association (LBMA) for settlement of gold contracts traded on the commodity derivatives segment of the exchange.   

According to NSE, the introduction of NRS for BIS – Standard Gold - will facilitate greater participation from domestic market players in the exchange traded deliverable bullion commodity derivatives by widening the scope of acceptable bullion commodity for delivery on the platform. 

This, in turn, will be helpful in deepening the market and facilitate the overall development of a physical settlement framework in Indian commodity derivatives market, NSE said. 

Ravi Varanasi, chief business development officer, NSE, said, "With the launch of NRS for BIS – Standard Gold, NSE aims to offer a fair chance to the Indian refiners, adhering to the BIS notified standards, to be a part of the exchange settlement framework. This initiative demonstrates NSE's vision and commitment towards inclusive growth of all market participants."

The move is also aimed at enhancing the effectiveness of the physical settlement framework for the commodity derivatives contracts in the country by including the Indian refiners in the exchange settlement framework. It also expects to widen the array of acceptable gold, which can be provided by the members for the physical settlement of gold contracts traded on the commodity derivatives segment of NSE. 

By way of these standards, the exchange has laid down detailed guidelines for criteria for empanelment, compliance requirements, technical evaluation, processing and sourcing audits. NSE launched its commodities derivatives platform during 2018-19.