Policy–Platform Paradox: Tech Troubles Delay Commodity Trading Market Launch

A lack of coordination with the regulatory body Bangladesh Securities and Exchange Commission, policy changes, and complications in technological preparedness are delaying the launch of a commodity-based transaction market in the country, said Saifur Rahman Majumder, Managing Director of Chittagong Stock Exchange.

On 10 May, Sunday, at a workshop titled “Commodity-Based Transaction Market: Potential, Structure and Future,” organized by the Capital Market Journalists Forum in the capital, he said that although technological capability, an automated transaction system, and necessary infrastructure are already in place, the initiative has been delayed due to policy shifts and coordination gaps.

He stated that, according to the preparation of the Chittagong Stock Exchange, the market could have been launched one and a half to two years earlier. However, due to changes in government, changes in policy frameworks, and the lack of timely coordination with the regulatory authority, it did not become possible.

Saifur Rahman Majumder said that although commodity-based transaction systems are an important part of capital markets internationally, in Bangladesh it is still a new concept. As a result, it has taken time to enhance the capacity of market participants and institutions, develop technical expertise, and formulate necessary regulations.

He said that advanced technology and automated software are being used to operate such transactions in the country, a large portion of which has been procured from abroad. At the same time, separate intermediary institutions for transactions have had to be established, manpower trained, and a secure information system developed. He further said that to introduce a modern technology-driven transaction system in the country’s capital market, there is no alternative to long-term planning and stable policy.

At the event, Chairman of the Chittagong Stock Exchange A K M Habibur Rahman said that due to some policy complications, implementation of the project has been delayed. However, infrastructural and technological preparations are now at an almost final stage. He informed that around 100 crore taka has so far been invested in establishing the commodity-based transaction market. He expressed hope that it will be launched within this year. He said that in the first phase, cash-settled contract trading will be introduced. Later, in the second phase, a system based on physical delivery of goods is planned to be added.

Commissioner of the Bangladesh Securities and Exchange Commission Farzana Lalarukh was present at the workshop as Chief Guest while the Chairman of the Chittagong Stock Exchange A K M Habibur Rahman attended the event as Special Guest. The session was presided over by President of the Capital Market Journalists Forum Monir Hossain.