Multi Commodity Exchange of India Limited (MCX) and Singapore Diamond Investment Exchange (SDiX) signed a Memorandum of Understanding (MoU) recently for establishing areas of cooperation between the two exchanges.   

MCX, India’s first listed, national-level, electronic, commodity futures exchange has “permanent recognition from the Government of India”.

Singapore headquartered SDiX, the world’s first commodity exchange in “physically settled diamonds”  enables trading in diamonds as a commodity, offering standardised structures and norms for the diamond-trading sector “so that diamonds can be traded with the same ease as other asset classes”.

Apart from knowledge sharing and research, the MoU will help standardise the product for Indian markets and enhance transparency in pricing. Under the MoU, areas for further collaboration between the exchanges will also be explored.

“India is the largest global hub for the cutting and polishing of diamonds, and has several thousand small medium and large enterprises which are involved in the diamond business,” MCX in a press note. “Moreover, through this partnership, the exchanges have agreed to work towards the goal of assisting the stakeholders in India’s diamond industry by bringing international best practices in price risk management and price discovery through innovative spot and derivative market operations.”

On the occasion of the signing, Mrugank Paranjape, MD & CEO, MCX said, “We are pleased to have signed this MoU with SDiX. The MoU will support the mutual interests of MCX and SDiX towards establishing price discovery, enhancing transparency in prices and help the value-chain with a risk management platform, in a commodity like Diamond in which India has a significant global presence. MCX already has the patronage of the Bullion & Jewellery value-chain in India. Through this association, both the exchanges, as well as the market stakeholders they serve, will be able to capitalise on the synergies, leverage knowledge and expertise to support innovations and development in diamond trading.”

Alain Vandenborre, Founder and Executive Chairman, SDiX commented: “We are extremely happy to sign the MOU with MCX which is India’s No. 1 commodity futures exchange. This partnership will help us to further understand India’s derivatives market which has grown rapidly in the recent years. Through this opportunity, we hope to achieve a win-win situation for the prosperous development of the markets that MCX and SDiX cater to India’s commodity derivatives market which is a fast growing market with growing trading volumes and expanding product range.”